APEC supports immediate aid for Indonesia
APEC supports immediate aid for Indonesia
KANANASKIS, Alberta (Agencies): Asia Pacific Economic Cooperation (APEC) finance ministers unanimously agreed the next disbursement of International Monetary Fund (IMF) aid to Indonesia shouldn't be delayed "unduly," Canadian Finance Minister Paul Martin said Saturday.
Martin said that while the ministers agreed at a meeting Saturday that the next $1-billion tranche from the IMF's $10- billion standby facility for Indonesia should be released as soon as possible, the IMF needs to be sure that the new Indonesian government will pursue economic reform.
"Nobody wants to delay unduly, and everybody wants to ensure that when the funds are advanced, they will have the maximum effect," Martin said.
He said comments made during the meeting showed the ministers want the funds to be released "in a timely way, as soon as possible."
IMF officials last week postponed an early-June board meeting during which release of the next tranche of a $10-billion standby credit facility to Indonesia was to have been voted on.
The announcement that the vote on the $1-billion tranche had been delayed followed widespread anti-government protests and an outbreak of violence in Jakarta, which led to the resignation of Soeharto Thursday and B.J. Habibie's appointment to succeed him as president.
Martin acknowledged that while some ministers called for an immediate disbursement of the IMF funds, others cautioned that the situation should be monitored more closely. However, he said such differences "were easily reconciled."
The potential for a prolonged delay irks Jakarta's immediate neighbors, who worry economic conditions in Indonesia could worsen and unleash a flood of refugees to their shores.
"The United States has the time and the luxury to wait, but I think, considering Indonesia, (that) it's not fair, not acceptable, not just, for a country that has undergone such a traumatic experience," said Malaysia's Deputy Prime Minister and Finance Minister Dato Seri Anwar Ibrahim.
Anwar also said he will urge the leaders of the IMF, World Bank and Asian Development Bank to support Habibie. He said it wouldn't be fair to press Indonesia to do more at this time and urged officials "not to frustrate the changes that are taking place."
Japan, whose Finance Minister Hikaru Matsunaga came under fire once again for his own country's weak economy, agreed. "One month is a limit. They (Indonesia) cannot wait any longer than that," a Japanese official said.
Martin said the IMF "... is in the process of monitoring the situation in Indonesia. The Fund has been encouraged to recommence the structural loan program as quickly as possible, and I think there is renewed confidence in a number of the measures and in the members of the new cabinet that have been put in place.
"But I think that at the same time we mean to make sure that those reforms are going to be put in place and that the situation evolves in a way that it should," he added.
He said measuring the extent of Indonesia's political stability as a condition for resumption of the IMF lending program was "really a judgment call...."
He said it is "very clear that economic reforms without political reforms and the (implementation) of a strong social package is simply not going to last."
The APEC groups Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, Taiwan, Thailand and the United States. Peru, Russia, and Vietnam are observers and will join APEC later this year.
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