Tue, 22 Aug 2000

APRN discusses debt, poverty alleviation

JAKARTA (JP): At least 120 delegates of 80 organizations from 22 countries are taking part in the second annual meeting of the Asian Pacific Research Network (APRN), which opened here on Monday.

The organizing committee said APRN, a network of some 23 active non-governmental organizations from 11 countries in the Asia Pacific, discussed several issues, including debt and poverty alleviation in the meeting.

The three-day conference was jointly organized by the International NGO Forum on Indonesian Development (INFID), the Indonesian Consortium for Nature and Forest Conservation (Konphalindo) and the Ibon Foundation of the Philippines.

Ibon research director Antonio Tujan Jr. said the results of the conference would be hammered out in the organization's leadership meeting on Thursday.

In his keynote speech, Rizal Ramli, the chief of the State Logistics Agency (Bulog), said one way of alleviating poverty in Indonesia was by extending credit to the poorer population, especially in the rural areas of Java.

He asserted that extending credit to people in rural areas was less risky than extending credit to big corporations.

Rizal said that a credit and savings scheme started in the early 1980s in which rural villagers could borrow money based on their credit history rather than collateral proved to be successful.

"They could borrow, for example, Rp 50,000 or Rp 100,000 in the beginning. If they were able to return the money on time, the amount of their next loan would be increased," he said.

Rizal said the scheme was better than subsidized credit which had the potential to be misused and mismanaged.

Binny Buchori of INFID said alleviating poverty in developing countries would not be possible unless foreign debts were at least partly canceled.

Binny, who is INFID executive secretary, said Indonesia's development policy, while aimed at fighting poverty, had instead resulted in the burden of more than $140 billion in debt, of which some $60 billion was private debt.

The health and education budget is reduced each year to pay interest on the debts, she said.

"How can we provide better basic needs such as health, educational facilities and affordable food when most of the national budget is used to pay principal and interest?" Binny asked in a speech opening a conference on poverty and development financing here.

Debt cancellations have been rendered impossible under the belief that Indonesia, along with many other countries falling in the category of middle-income countries, were rich enough to pay, she said.

"Time and time again we hear that 'in no way can your country get debt cancellation because you are rich'," Binny said. (10)