A confusing signal

A confusing signal

As soon as the realities of the economic crisis hit Indonesia, a program of economic rehabilitation and reform was begun with the banking sector given first priority for treatment. This was sensible because the banking sector constitutes the main artery of the economy.

The reform and rehabilitation process inflicts some pain because certain banks would face closure. Only banks that are relatively healthy or institutions that have a good chance to regain their health can be preserved. Even so, however great the pain, the public accept, and even support, the cure.

Another important point is that reformation and rehabilitation of our banking industry also serves to restore the trust of the international community in our economy. Therefore, it is believed that whatever steps the government takes, no upheavals will result as long as the measures taken are fair and the procedures transparent.

We don't know, though, whether the public's equanimity can be maintained, now that the government has given the impression of being indecisive in following through with the bank liquidation process. We are afraid the delay in bank closures will be interpreted as an idle promise on the part of the government to put the banking sector in order. Again, judging by past experience, we strongly believe that our present banking crisis is caused, among other things, by the government's lack of determination to correct chronic mismanagement of certain banks.

-- Kompas, Jakarta