Mar'ie seeks debt reduction<\/p>\n
JAKARTA (JP): Minister of Finance Mar'ie Muhammad has called
\non multilateral lending institutions to slash the debt
\nobligations of the world's poorest countries and restructure
\nthemselves to serve the changing world economy.<\/p>\n
Speaking at the 1995 joint annual International Monetary Fund-
\nWorld Bank meeting in Washington on Tuesday, Mar'ie said that
\ndespite the rapid changes in the world economy, overall changes
\non the part of the multilateral organizations have been slow.<\/p>\n
"The changes in the world economy demand that we rethink the
\nrole of the international institutions and reshape them to serve
\nour future needs," Mar'ie said in his speech, a copy of which was
\nmade available here yesterday.<\/p>\n
Mar'ie said the ultimate goal of the reform proposed is to
\nrenew the significance and contribution of the multilateral
\nlending institutions to growth, equity and stability in a newly-
\nglobalized world economy.<\/p>\n
The reformed institutions, however, should not compete with
\nthe private sector. "We do not need multilateral organizations to
\ndo what private institutions can do perfectly well," Mar'ie said.<\/p>\n
He also expressed appreciation for the initiative of the
\npresident of the World Bank, James Wolfensohn, in setting up a
\nseparate fund for the purpose of multilateral debt-reduction.<\/p>\n
"Up to recently, the very idea of multilateral debt reduction
\nwas considered by some circles as unnecessary and irrelevant.
\nEven the existence of a multilateral debt problem was
\nquestioned," Mar'ie said.<\/p>\n
Debt burden<\/p>\n
Mar'ie said that Indonesia, as chairman of the Non-Aligned
\nMovement, wants the multilateral creditors to pay closer
\nattention to the debt burdens and debt overhang of many
\ndeveloping countries, in particular the poorest countries, which
\nare far from being resolved.<\/p>\n
In his speech to participants in the World Economic Forum in
\nSingapore last month, President Soeharto criticized multilateral
\ncreditors as being unwilling to even discuss the possibility of
\ndebt reduction.<\/p>\n
Soeharto urged multilateral creditors to slash debt
\nobligations of the world's poorest countries, as had been done by
\nbilateral and commercial creditors.<\/p>\n
What is required from the multilateral institutions now is not
\nfurther debt rescheduling but a once-and-for-all debt settlement,
\nthrough meaningful reduction of all categories of debts, Mar'ie
\nsaid yesterday.<\/p>\n
He said that for many poor countries the servicing of
\nmultilateral debts has become the bulk of debt service payments.
\nAt present it is impossible for debtor countries to have their
\ndebts rescheduled, let alone see a reduction in their
\nmultilateral debts.<\/p>\n
"As a matter of fact, many poor debt-distressed countries are
\nable to service their multilateral debts because they do not
\nservice their bilateral debts fully," Mar'ie said. "As a
\nconsequence, while they service their multilateral debts, at the
\nsame time they are forced to accumulate large and growing arrears
\non their bilateral debts."<\/p>\n
He asserted that debt reduction by multilateral institutions
\nwill not jeopardize their credit rating. The multilateral
\nfinancial institutions are not only financially strong, but their
\nreputation in international markets depends on capital guarantees
\nfrom their members, particularly major developed countries.<\/p>\n
Quoting the Communique of the G-7 Summit in Halifax, Canada,
\non June 15-17, Mar'ie said the G-7 countries have recognized the
\nexistence of a substantial multilateral debt problem and have
\nasked the Bretton Woods Institutions to find a solution to the
\nproblem.<\/p>\n
"Thus, the G-7, the Non-Aligned Movement, other members of the
\nWorld Bank and the Fund, the Non-Governmental Organizations and
\nthe rest of the international community are emphasizing the
\nurgency to arrive at effective solutions to the debt problems of
\nthe poorest countries," Mar'ie said. (rid)<\/p>\n
IMF -- Page 9<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/marie-seeks-debt-reduction-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }