Businesspeople await implementation of reforms

Sat, 17 Jan 1998, 00:00 WIB | Source: JP

JAKARTA (JP): Businesspeople agreed yesterday that the reform
program set out by the government Thursday was good, but warned
that negative sentiments would remain until the election of the
country's new president in mid-March.

The chairman of the Indonesian Chamber of Commerce and
Industry, Aburizal Bakrie, said the massive reform program and
the establishment of a special presidential team to monitor its
implementation should actually impress the market.

"We hope this reform package will be able to revive our dying
national economy," said Aburizal, also chairman of the Bakrie
Group.

Sofjan Wanandi, chairman of the Gemala Group, said the reforms
were good. But looking at market reaction to the announcement of
the reforms, foreign inventors seemed in doubt about the
government's seriousness in implementing them.

"This negative reaction shows that foreign investors are still
skeptical about our efforts, there must be something wrong here,"
Sofjan told The Jakarta Post.

"The package itself is good, that is why we all must support
it. But foreign investors think we're not going to implement it,"
he said.

Sofjan said the political situation was making things more
difficult and it was critical to mend the Indonesian economy. He
said there were many unresolved political issues regarding the
presidency and vice presidency.

As foreign investors awaited the program's implementation,
negative sentiment could persist for six more months, or at least
until the convening of the People's Consultative Assembly to
choose a new president and vice president in March, Sofjan said.

Fahmi Idris, an executive with the Kodel Group, shared
Sofjan's argument, saying the government had to follow up the
massive economic reforms with political reforms.

"This must be followed up by reforms in other sectors,
especially in politics. And the political reform process should
start with the empowerment of the House of Representatives,"
Fahmi said.

"If the House is on a par with the executive branch, I believe
a more democratic life in our country would result as the House
could effectively exercise its check and control function," he
said.

Speaking on reforms, Fahmi said they showed the government's
seriousness in pursuing a healthy economy. But again, their
implementation would determine the quality of the reforms.

Sofjan was more skeptical about the implementation of reforms
as he saw many bureaucrats half-hearted in handling the crisis.

"I'm afraid they won't seriously implement the reforms. They
might even drag their feet on the elimination of the monopolies,
and this could create more market distortion," he said.

The elimination of the State Logistics Agency's (Bulog)
monopoly over food commodities must be monitored cautiously to
prevent worse market distortion, he said.

"I urge those who have enjoyed the benefits of the monopolies
for 25 years to surrender their privileges. I strongly urge all
parties to be united and stop pointing fingers at each other,"
Sofjan said.

He suggested that all parties show togetherness as a nation to
cope with the crisis in order to restore investor confidence.

"People will not be willing to suffer if they see others who
are not suffering," Sofjan said.

"This is the only momentum behind our survival, whether we are
going to restore confidence or not," Sofjan added.

The government and other responsible parties should not follow
the move by blaming each other, he said.

He also criticized the military's recent call for 13 prominent
businesspeople to sell their dollars to support the rupiah.

"This kind of statement is counterproductive. Instead of
blaming each other, why don't we seek a solution?"

He suggested that the monetary authority intervene in the
market soon to supply needed dollars, which had become scarce.

Exporters must immediately begin to exchange their dollars for
rupiah as well, he said. But everything must be done voluntarily,
without any pressure from any party. Everything should be based
on clear rulings. (das/rid)

Criticism -- Page 2

Memorandum -- Page 5