Rupiah intervention impact would be limited: Hashimoto<\/p>\n
TOKYO (Agencies): Japan's Prime Minister Ryutaro Hashimoto
\nsaid yesterday that intervention in the foreign exchange market
\nwould only have a limited impact in dealing with sudden
\nfluctuations in Indonesia's rupiah and other Asian currencies.<\/p>\n
Japan intervened to buy the rupiah in collaboration with
\nSingapore last November to support the currency, but the impact
\nwas limited amid market speculation that Indonesia was not
\nadhering to the economic program set by the International
\nMonetary Fund (IMF), Hashimoto told an Upper House parliamentary
\ncommittee.<\/p>\n
Rather, it is necessary to support Indonesia and other Asian
\ncountries with structural reforms led by the IMF, Hashimoto said.<\/p>\n
"There are limits to short-term intervention to deal with
\nsudden market fluctuations. This is based on actual experience,"
\nhe was quoted as saying by Reuters.<\/p>\n
Meanwhile in Canberra the Australian government said yesterday
\nIndonesia must engage in political reform and economic changes
\nconsistent with an International Monetary Fund package if the
\nvalue of the rupiah is to recover.<\/p>\n
Foreign Minister Alexander Downer said the only way for the
\nIndonesian economy to become viable is for the value of the
\nrupiah to rebound.<\/p>\n
Downer told Parliament provision of more aid to Indonesia by
\nAustralia is under review, but said economic and political
\nreforms are more important at this time.<\/p>\n
"I don't think...the urgent need is so much additional funds.<\/p>\n
The challenge for the Indonesian economy is to get the
\nexchange rate back up from where it currently is to make the
\noperation of the economy viable again," he said as reported by
\nDow Jones Newswires.<\/p>\n
And that can only be achieved if first of all the political
\nstability is achieved for a constructive program for political
\nreform, and if there is a continuation of the difficult task of
\neconomic reform consistent with the IMF package," Downer added,
\nreferring to changes needed to boost the rupiah's value and make
\nthe economy viable.<\/p>\n
The rupiah has fallen from around Rp 2,500 in mid-1997 to a
\nlow of near Rp 17,000 last week. it was trading at Rp 10,800 to
\nU.S. dollar yesterday.<\/p>\n
Australia has provided additional humanitarian aid of around
\nA$50 million to Indonesia, both on a bilateral basis and through
\na food aid package coordinated by the World Bank.<\/p>\n
It has also offered up to US$1 billion in standby credit under
\nthe US$43 billion IMF-led financial assistance package for
\nIndonesia.<\/p>\n
Downer rejected what he said are calls from the main
\nopposition Labor Party for Australia to coordinate and support an
\nIndonesian version of the Marshall Plan, which funded a
\nrebuilding of Europe after World War II.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rupiah-intervention-impact-would-be-limited-hashimoto-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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