Bappenas' role comes into question

Bappenas' role comes into question

JAKARTA (JP): Chairman of the National Development Planning
Board (Bappenas) Ginandjar Kartasasmita hinted yesterday that it
might be necessary to review the role of the board as the
government loosens its grip on the private sector.

"Our economy is getting more privatized and the government no
longer controls most production sectors. That raises questions
about the likely future role of Bappenas," he told a development
planning seminar at his office.

Ginandjar, also the minister for national development
planning, said that the private sector is becoming so strong that
it can either accept or ignore government policies as it pleases.

"When we introduced minimum wages for workers, for instance,
many businessmen said they would move their businesses abroad,"
he said.

The seminar, attended by economists, prominent businessmen and
media figures and representatives of non-governmental
organizations, discussed the role of development planning in the
current era of globalization.

Ginandjar pondered whether inadequate development planning was
partly responsible for the widening gap between rich and poor in
Indonesia.

"That's why I invited you here, so that we can thoroughly and
vigorously discuss the issue," he told the seminar.

Last week, the owners of almost 100 of the country's largest
business groups gathered in Bali to exchange ideas about how the
widening disparity between the poor and the rich might be
addressed.

Among the participants yesterday were economists Christianto
Wibisono, Dorodjatun Kuntjoro-Jakti, Adi Sasono, Didik J.
Rachbini, Faisal Basri, Mari E. Pangestu, Rizal Ramli and
Sjahrir; publisher of the Kompas daily Jakob Oetama; Samsul Basri
of the Suara Karya daily; businessmen Sofyan Wanandi, Aburizal
Bakrie, Theodore Permadi Rachmat, Fahmi Idris and Arifin
Panigoro; and, representing NGOs, Bambang Ismawan and Bambang
Wiwoho.

Many participants at the seminar raised the issue of the
widening disparities between rich and poor, between the central
government and local administrations and between the western and
eastern provinces of Indonesia.

Decentralization

Faisal Basri, an economist at the University of Indonesia,
suggested that Bappenas speed up the decentralization process so
that local administrations would be more autonomous in developing
their areas.

"Look, more than 94 percent of the national income is spent by
the central government and less than six percent is allocated to
local administrations. If the state budget is virtually
monopolized by the central government, how can the local
administrations develop their areas with local initiatives and
autonomy?" Faisal asked.

Economist Sjahrir called for more democratization of the
country's economy, saying the government is still reluctant to
abolish its monopolies over several basic commodities, such as
wheat and sugar.

Sjahrir said that the government appeared to be indulging in
self-congratulatory complacency over the impressive economic
indicators, such as the rates of growth and investment.

"But the government seems to ignore the vital aspect of
equity," he added.

Some participants complained about Bappenas' perceived
shrinking role and decreasing clout in the country's development.

Businessman Sofyan Wanandi, for instance, said that the
current Bappenas seems to be much weaker and less influential
than that headed by Widjojo Nitisastro (in the 19670s and 1980s).

Ginandjar responded that the comparison was unfair because he
is not concurrently holding the portfolio of coordinating
minister for economic affairs, as Widjojo did when he led
Bappenas.

"What Pak Widjojo held at that time is now taken up separately
by three ministers: Myself as chairman of Bappenas, Saleh Afiff
as coordinating minister for economy and finance and Hartarto as
coordinating minister for industry and trade," Ginandjar said.

Inequity

Businessman Fahmi Idris blamed growing economic inequity on
monopolies and oligopolistic practices which, he said, have been
distorting the market economy.

"The government seems unable to cope with those economic
distortions," Fahmi told the meeting.

He said that even common people were fully aware of the
irregularities and bad business practices which benefit only a
few.

He warned that pent-up frustration on the part of ordinary
people might explode in a massive outburst of anger, such as
occurred many years ago.

Adi Sasono of the Center for Information and Development
Studies concurred that the current inequity had been generated by
what he described as the government's preferential treatment of a
few business groups.

He hailed the market economy principle the government has been
pursuing over the past 10 years, but nonetheless urged the
government stop its "excessive" intervention in order to allow
normal market mechanisms to operate.(rid/vin)