Adi confirms setting up people's economy agency

JAKARTA (JP): Controversial Minister of Cooperatives and Small Enterprises Adi Sasono confirmed on Sunday that the government was establishing an Agency for the Development of the People's Economy (LPER).

However, he denied that the agency's establishment was carried out discreetly.

"We have not disclosed the establishment of such an agency because it is still being studied. So, it is not true that it is being set up quietly or in a guerrilla kind of way," Adi was quoted by Antara as saying.

He also expressed disappointment that the government's efforts to help the needy always met with cynicism.

"Why is it that every government move to help the small people always elicits unfriendly responses?" he asked.

Adi has reportedly set up the agency as part of his ambition to boost the lower end of the business sector.

Some reports said the new agency would receive Rp 10 trillion (US$1.3 billion) in capital and that the government would shift its ownership in some state-owned enterprises to the agency.

"That's just presumption. Our discussions on the agency have not yet reached that far," Adi said.

He reiterated that the agency would not have anything to do with taking over the assets of troubled banks which cannot repay the central bank's liquidity loan facilities.

He stressed, however, that such an agency was crucial to build a strong foundation for a people-oriented economy.

In the past three decades under former president Soeharto, who resigned in May, a large share of the economy was controlled by a handful of conglomerates, most of which are controlled by ethnic Chinese.

Adi, who was appointed a minister by his political ally President B.J. Habibie in June, has recently proposed a "redistribution of assets."

This concept was blasted by many observers, who charged Adi's populist policy was merely a "Robin Hood" ploy to win political favor and that it would not develop real entrepreneurs.

Responding to this, Adi argued: "A handful of conglomerates have received facilities this whole time, and we have been unfair toward the people by providing loans worth trillions of rupiah only to the large businesses."

"If it is true that the small and medium-scale businessmen had no sense of entrepreneurship, then why is it that the large businesses were the first to collapse while the small ones continue to survive during the crisis?" he asked.

"On the other hand, if the large businesses were more entrepreneurial than the small businesses, how come the former were the ones which bribed government officials, stole state assets, and fled with their money to Singapore or Hong Kong?" he added.

Adi has been charged with being anti-market, anti-tycoons, and anti-Chinese by his critics. (das)