New IBRA boss<\/p>\n
The appointment of a new chairman of the Indonesian Bank
\nRestructuring Agency (IBRA) comes as no surprise. Rumors have
\nbeen circulating for the last few months about antagonisms
\nexisting between the outgoing chief, I Putu Gede Ary Suta, and
\nthe State Minister of State Enterprises, Laksamana Sukardi, about
\nIBRA's policies that appear to favor conglomerates and about
\nconflicting political interests jostling for the more than US$60
\nbillion worth of assets under the control of IBRA.<\/p>\n
IBRA's new chairman, Syafruddin A. Temenggung, becomes the
\nseventh IBRA chief within just four years. The question is, how
\nlong will he survive in his new position?<\/p>\n
IBRA was set up in early 1998 to restructure failed or ailing
\nbanks which collapsed under huge bad debts caused by the drastic
\ncollapse of the rupiah during the second half of 1997. At least
\ntwo parties were responsible for this collapse: first, the
\ncentral bank, Bank Indonesia, which was supposed to supervise and
\ncontrol the banks, and second, the conglomerates, who either
\npartly or wholly owned those banks, and used them for their own
\nspeculative business interests. This was a fatal mistake.<\/p>\n
Presidential Decree No. 27\/1998, under which IBRA was set up,
\nand the ensuing Government Regulation (Peraturan Pemerintah) No.
\n17\/1999, practically relieved those two parties of their
\nresponsibilities. The government (IBRA) took over their huge
\nburden and IBRA was left to clean up the mess created by the
\nincompetent supervising body, Bank Indonesia, and greedy
\nconglomerates. The Indonesian taxpayers are supposed to pay the
\nbill, which is yet another fatal mistake.<\/p>\n
IBRA basically has two enormous jobs. First, to settle the
\nhuge bad debts which have incapacitated the banks. Second, to
\nreinvigorate those banks so that they can perform their vital
\nfunction in the country's economy. For both those jobs, the time
\nschedule is set: the deadline is February 27, 2004.<\/p>\n
The first job includes selling assets supposedly worth more
\nthan $60 billion. The going estimates of their market value vary
\nbetween 15 percent to 40 percent. This is bounty for our
\nnotoriously greedy politicians. More than three years have since
\npassed, and not even half of those assets have been sold.<\/p>\n
The second job is no less important. Without a healthy banking
\nsystem, it would be really hard to imagine Indonesia coming out
\nof the current multidimensional crises. But nobody seems to care.
\nWe have only less than two years left before deadline and we have
\nnot seen any sign of a healthier banking system.<\/p>\n
Temenggung probably will not be the last chief of IBRA before
\nthe deadline in 2004, and probably nobody will care. The relevant
\nquestion is not who is appointed to chair the agency, but what
\nthe purpose of IBRA is in the first place. If it is supposed to
\nbe temporary, there should be a clear-cut policy of how the
\nbanking system should be developed to serve the economy of the
\ncountry, and that policy has to become the guideline for IBRA.
\nThere has been none so far.<\/p>\n
Whatever the case, it is not fair to impose the bill on
\nIndonesian taxpayers while the central bank officials and
\nconglomerates remain unaccountable.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-ibra-boss-1447899208",
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