CGI meeting should proceed as planned: WB

JAKARTA (JP): World Bank managing director Sven Sandstrom has urged Indonesia's major donors to continue their financial support for the country at their upcoming annual meeting.

Sandstrom said on Monday the meeting of the Consultative Group on Indonesia (CGI) must proceed as scheduled next month, despite calls from non-governmental organizations (NGOs) to postpone the gathering until the election of a new president.

"I think the money should continue to be disbursed and the program should not be halted awaiting the presidential election," Sandstrom said at the State Palace after meeting with President B.J. Habibie.

"I believe the CGI meeting should take place as scheduled... and I think the donor community is prepared to move ahead."

Sandstrom is in Jakarta for a meeting with government officials ahead of the July 27 CGI meeting in Paris. The World Bank chairs the CGI grouping.

Sandstrom also met with popular opposition leader Megawati Soekarnoputri, whose Indonesian Democratic Party of Struggle (PDI Perjuangan) continues its commanding lead in the provisional vote results.

Several NGOs grouped in the International NGO Forum on Indonesian Development (INFID) have called on the government and the World Bank to delay the donors meeting until a new government is formed in Indonesia.

The country held its landmark elections on June 7. Newly elected members of the House of Representatives, plus a group of appointed representatives, will elect the country's new president in November.

INFID also urged donors to put the issue of rampant corruption, including the abuse of international aid in the country, on the meeting's agenda.

Sandstrom said that continuity in loan commitments would be a positive contribution for recovery efforts in the crisis-hit economy.

He said the economic recovery programs had wide support and included the backing of the major political parties.

Asked to comment on the rupiah, Sandstrom said: "The rupiah will continue to strengthen, that's our expectation. The continuity in the reform program and also the very successful outcome of the election process has helped in terms of credibility and confidence in the economy.

"The rupiah continues to strengthen along the line of the economy as a whole and we find this very encouraging and we will continue with our support."

Deputy for international cooperation at the National Development Planning Board (Bappenas) Budhy Tjahjati said last week that based on "initial talks with multilateral and bilateral donors", Indonesia might receive US$4.72 billion in loan commitments at the upcoming CGI meeting.

This is much less than the almost $8 billion in aid pledges received in 1998 by the government.

Coordinating Minister for Economy, Finance and Industry Ginandjar Kartasasmita had earlier indicated that the country might not be able to obtain similar loan commitments in the current year due to the already heavy exposure of particular donors to Indonesia. (rei/prb)