Various factors may affect economic development<\/p>\n
JAKARTA (JP): The recent banking scandal, leveling-off of non-
\noil exports, declines in foreign investment, slow depreciation of
\nthe rupiah, low oil prices and the increase in U.S. interest
\nrates are likely to affect Indonesia's economic development, an
\nanalyst says.<\/p>\n
\"Indonesia, therefore, should take strategic measures to
\novercome these problems,\" Rizal Ramli, the managing director of
\nEconit, said yesterday during a discussion on developments in the
\nmacroeconomic climate.<\/p>\n
Econit is an independent advisory group on economics, industry
\nand trade.<\/p>\n
He said many foreign parties have become jittery over the
\nperformance of Indonesia's economy and its ability to achieve the
\ngovernment's development targets.<\/p>\n
\"Although some of the factors causing this apprehension cannot
\nbe explained economically, such as those related to the country's
\npolitical situation, most of them are a result of economic
\nforces,\" he said.<\/p>\n
The case of Bank Pembangunan Indonesia (Bapindo) -- which
\ninvolves a bad loan of US$620 and accusations of official
\ncorruption -- has hurt the image of the country's banking system
\nin the eyes of the international world.<\/p>\n
\"There is no need to argue about the poor rating that an
\ninternational rating company has given to our banks. What is
\nneeded now is a concrete plan of action to correct our mistakes,\"
\nhe said of the recent Standard & Poors assessment that
\nIndonesia's banking industry is in financial stress.<\/p>\n
Disclosure<\/p>\n
Director of Econit Laksamana Sukardi said more banking
\ndisclosure is needed to prevent such cases from happening again.<\/p>\n
He explained that disclosure does not necessarily mean a
\nviolation of banking secrecy, which has been designed for the
\nbenefit of the public and the bank's clients, \"not as a shield
\nfor certain people to hide behind,\" he said.<\/p>\n
According to Laksamana, the point in making a banking
\ndisclosure was to balance it with the bank's secrecy. He believes
\nthe current situation is imbalanced, with more secrecy than
\ndisclosure.<\/p>\n
He said disclosure could reveal the concentration of a bank's
\nportfolio and its fields of business, its creditors who were at
\nor approaching the legal lending limit, the percentage of
\ncreditors from small, medium and large-scale businesses and big
\nacquisitions made by the bank's clients.<\/p>\n
He also suggested that a higher minimum capital be stipulated
\nfor the establishment of a bank. The current stipulation is Rp 50
\nbillion ($23.36 million), as compared to $400 million in Taiwan.<\/p>\n
Rizal said that in the other sectors, the government has yet
\nto establish clear plans to meet the new global trade era
\nfollowing the conclusion of the Final Act of the General
\nAgreement on Tariffs and Trade.<\/p>\n
\"An increase of about 15.4 percent or $116 billion in world
\ntrade will go to Asian countries outside Japan as a consequence
\nof the GATT. Without pro-active steps to increase non-oil
\nexports, we will never gain the benefit of the new trade
\nagreement,\" he said.<\/p>\n
Rizal also suggested that deregulation is needed to reduce
\nhigh business costs. (10)<\/p>",
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