Protection from the IMF<\/p>\n
Jergen Kaiser writes in The Jakarta Post on Aug. 6 about the
\nneed for another way when a country finds itself in a debt trap.
\nRather than being thrown into the hands of its creditors, there
\nshould be some neutral third party to arbitrate a solution.<\/p>\n
I support this concept, however Kaiser's article only portrays
\nhalf the story, or rather half the solution. As with chapter 11
\nbankruptcy in the United States, when a private company files
\nwith a court for protection from its creditors, a competent third
\nparty is appointed by the court to administer the company.<\/p>\n
The administrator not only renegotiates the company's loans
\nwith its creditors, but also restructures the company and
\nattempts to rid it of the bad management and bad practices that
\nled to the crisis in the first place.<\/p>\n
If Indonesia wants protection from its creditors it first has
\nto admit that it has failed to put its own house in order. Then
\nsecond, it has to be willing to let somebody else do the job for
\nthem. This is not as crazy as it may sound, and there is a
\nprecedent of sorts, when previously the Indonesian government in
\neffect subcontracted out a large part of the functions of its
\ncustoms department to the Swiss-based Sucofindo.<\/p>\n
How can a country come complaining to its creditors about the
\ndebt burden on its budget when 30 percent to 50 percent of the
\nmoney it does have is stolen or abused by greedy bureaucrats and
\npoliticians, when city or regional councillors waste limited
\nresources on junkets, traveling to Europe or wherever on endless
\n\"comparative studies\", or allocate gifts of Rp 250,000,000 each
\nto provincial legislators? In circumstances such as these it is
\nsimply too easy to just request a debt rollover when it's your
\nchildren who are going to have to foot the bill.<\/p>\n
Indonesia is not a poor country but it is being impoverished
\nnot by the IMF, but by those very same bureaucrats and
\npoliticians, and by the bankers who stacked their Singapore and
\nSwiss bank accounts with liquidity support funds and by a
\ngovernment which does nothing about it.<\/p>\n
A solution is definitely needed to the heavy debt burden faced
\nby Indonesia, but one that is a balanced solution. One that
\nincludes strenuous efforts to recover stolen assets and prosecute
\nthe offenders.<\/p>\n
Incidentally, I might have missed something, but why does
\nIndonesia need IMF money in the first place when it has about
\nUS$29 billion in reserves of its own? Australia has been getting
\nalong just fine for years with half as much.<\/p>\n
DAVID SINCLAIR<\/p>\n
Bantul, Yogyakarta<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/protection-from-the-imf-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }