New law 'will fire' BI board of governors<\/p>\n
JAKARTA (JP): Coordinating Minister for the Economy Rizal
\nRamli said on Thursday that the incumbent board of governors of
\nBank Indonesia should be suspended after the new central bank law
\nbecomes effective.<\/p>\n
Rizal said that this would allow the House of Representatives
\nto select replacement board members based on the new central bank
\nlaw.<\/p>\n
\"The current board of governors must step down once the new
\ncentral bank law is effective,\" Rizal asserted, implying that
\nGovernor Sjahril Sabirin who resumed his job on Wednesday would
\nbe replaced sometime in January.<\/p>\n
The government has proposed a bill to amend the central bank
\nlaw, which was enacted in May 1999.<\/p>\n
The amendment includes allowing the House to dismiss board
\nmembers who have failed to perform well or who have not been
\nactive in office for at least three consecutive months.<\/p>\n
Under the current law, the board members cannot be dismissed
\nunless they have been proven to have committed a crime, become
\nincapacitated or voluntarily resign.<\/p>\n
A House special committee is currently debating intensively
\ngovernment-proposed amendments to the central bank law. The team
\nwill continue the deliberation process although the House is
\nscheduled to enter a 32-day recess starting Monday.<\/p>\n
Many see the proposed amendment as being aimed mainly at
\nremoving legal obstacles to the ouster of Bank Indonesia Governor
\nSjahril from his post.<\/p>\n
Sjahril was released Tuesday after five months of house arrest
\nover alleged involvement in the Bank Bali scandal. Sjahril has
\nso far denied the allegation.<\/p>\n
President Abdurrahman Wahid has been demanding a major
\nreshuffle at the central bank since last year, but Sjahril has
\nresisted.<\/p>\n
Asked to comment about the release of Sjahril, Rizal said that
\nSjahril and other board members could also be linked to other
\ncriminal cases including those concerning the counterfeiting of
\nbank notes.<\/p>\n
He said that the fake bank notes could not have been printed
\nwithout collaboration with Bank Indonesia insiders because their
\nserial numbers were the same as on original notes.<\/p>\n
\"Sjahril Sabirin is linked to the Bank Bali corruption
\ncase ... but there are also other, larger cases including the
\nBLBI (emergency liquidity loans)... and the counterfeiting of
\nbank notes which has inflicted losses worth trillions of rupiah
\non the state,\" Rizal said.<\/p>\n
\"Somebody must be responsible for these cases, morally and
\nprofessionally,\" he added.<\/p>\n
BLBI refers to the Rp 144.5 trillion of government emergency
\nliquidity support given to ailing banks between 1998 and 1999
\nmost of which was misused by the recipient banks due to weak
\nsupervision on the part of the central bank.<\/p>\n
Separately, Rizal said that the House factions on the special
\ncommittee have proposed new additions to the government-proposed
\namendments, including plans to force Bank Indonesia to pay tax
\nand to allow the House to debate the central bank's budget.<\/p>\n
Meanwhile, Sjahril said on Thursday that if the new central
\nbank law forced him to step down, he would be willing to do so.<\/p>\n
Asked if he still was interested in occupying the top position
\nin Bank Indonesia, he said: \"If my turn comes to an end, so be
\nit, I've had enough. I'll try to find more fun things (to do).\"<\/p>\n
Sjahril was speaking at a breaking of the fast gathering with
\njournalists. He retook possession of his office on Wednesday.<\/p>\n
Asked whether he would propose new names to replace the five
\nmembers of the board of governors who had tendered their
\nresignations last month, he said: \"I will still have to talk it
\nover with the House.\"<\/p>\n
Senior deputy governor Anwar Nasution and four other deputy
\ngovernors tendered their resignations last month, a few days
\nbefore the government proposed the amendment of the central bank
\nlaw.<\/p>\n
Sjahril reiterated that he had been betrayed by Anwar, but he
\ndeclined to provide details.<\/p>\n
The President has recently proposed Anwar for the top post at
\nBank Indonesia.<\/p>\n
Sjahril did not see the amendments of the central bank law as
\nurgent, saying there are other more important matters to deal
\nwith .<\/p>\n
He admitted that the current central bank law might not be
\nperfect, \"but please don't forget it has only been in effect for
\nabout one year.\"<\/p>\n
\"If the House feels disappointed with the central bank's
\nperformance, it can summon the central bank board members and
\nrequest that they account for their actions,\" he said.<\/p>\n
\"The House can control Bank Indonesia. So it's not true to say
\nthat the central bank carries out its day-to-day activities
\nwithout House supervision,\" Sabirin added. (rei)<\/p>",
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