Soeharto will pursue reforms: IMF<\/p>\n
JAKARTA (JP): The International Monetary Fund (IMF) expressed
\nconfidence yesterday that President Soeharto would accelerate
\neconomic reforms to restore confidence in the economy.<\/p>\n
IMF first deputy managing director Stanley Fischer said after
\na 90-minute talk with Soeharto that he had a \"very, very good\"
\nmeeting with the President on efforts to haul Indonesia out of
\nits financial crisis.<\/p>\n
Fischer said the President was determined to intensify the
\nreforms agreed with the IMF in return for a US$40 billion
\nbailout.<\/p>\n
\"The President was very clear in his determination to stay
\nwith the program and to strengthen and to accelerate it. There
\nwas no ambiguity in anything he said,\" Fischer told journalists
\nafter meeting with Soeharto at his residence on Jl. Cendana,
\nCentral Jakarta.<\/p>\n
Fischer arrived here Sunday as financial markets and
\nIndonesia's main creditors sought firm action rather than mere
\npromises that the government would stick to the terms of the IMF
\nbailout package.<\/p>\n
Minister\/State Secretary Moerdiono said Soeharto was very
\nsatisfied with the results of the meeting.<\/p>\n
Moerdiono said there were no basic differences of views
\nbetween the IMF and the government. The only difference was on
\nthe timing of the reforms to be taken.<\/p>\n
\"The President is confident that his next meeting with IMF
\nManaging Director Michel Camdessus will also be fruitful,\" he
\nsaid.<\/p>\n
Camdessus is expected to arrive here tomorrow.<\/p>\n
Minister of Finance Mar'ie Muhammad also praised yesterday's
\nmeeting as satisfactory.<\/p>\n
\"We will soon follow up the meeting with further negotiations
\nwith IMF officials,\" Mar'ie said.<\/p>\n
However, Fischer warned that one could never be absolutely
\nsure the government could turn confidence around in a short time.<\/p>\n
\"But I think the critical steps will be taken soon. That
\nshould, or begin to, restore confidence,\" he said.<\/p>\n
He said he would like to see the government show in a few days
\nits commitment to carry out the program and to undertake a
\nvariety of measures that could restore confidence in the economy.<\/p>\n
\"The confidence of Indonesian people and the confidence of
\noutside investors in Indonesia depends on how the government of
\nIndonesia treats the economy, and that depends on what it does in
\nthe budget and other commitments it has made,\" he said.<\/p>\n
When asked about the draft state budget, Fischer said, \"I
\nthink it has to be made more specific, the assumptions have to be
\nspelled out.\"<\/p>\n
The 1998\/1999 State Budget is projected to balance at Rp
\n133.49 trillion ($15.5 billion), a 32 percent increase from the
\ncurrent budget of Rp 101.08 trillion.<\/p>\n
State Minister of National Development Planning Ginandjar
\nKartasasmita defended yesterday the assumptions used by the
\ngovernment in drafting the state budget.<\/p>\n
The assumptions include the rupiah's exchange rate stabilizing
\nto 4,000 to the U.S. dollar, an economic growth rate of 4
\npercent, an inflation rate of 9 percent and average crude oil
\nprice of $17 per barrel.<\/p>\n
Ginandjar said that even though the 1998\/1999 budget followed
\nthe principle of a balanced budget, it opened the possibility for
\nthe government to achieve a surplus equivalent to 1 percent of
\nthe gross domestic product as required by the IMF.<\/p>\n
The possibility of achieving the surplus would be from
\nremoving the fuel subsidies of over Rp 10 trillion, increasing
\nrevenue from taxes and reducing spending.<\/p>\n
\"However, it will still be discussed with the IMF whether it
\nis realistic to pursue the 1 percent surplus in this current
\neconomic situation,\" Ginandjar said.<\/p>\n
Many analysts have blamed the announcement of the draft state
\nbudget, which they described as unrealistic, for worsening
\nIndonesia's financial crisis last week, when the rupiah plunged
\nto an all-time low of 10,000 to the dollar.<\/p>\n
Bank Indonesia Governor J. Soedradjad Djiwandono criticized
\nanalysts' view on the budget as unfair as they did not see the
\nreal value of the budget in dollar terms.<\/p>\n
He said although the budget would rise 32 percent in terms of
\nrupiah, it would not increase in terms of dollars. (prb\/rid)<\/p>\n
Kosgoro -- Page 2<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/soeharto-will-pursue-reforms-imf-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }