CGI meeting to take on corruption issues
Berni K. Moestafa and Fabiola Desy Unidjaja, The Jakarta Post, Jakarta
For the first time, the Consultative Group on Indonesia (CGI) may link its loan programs with efforts to fight corruption, as the government hopes to secure Rp 35.4 trillion (about US$3.4 billion) from next month's CGI meeting.
Coordinating Minister for the Economy, Dorodjatun Kuntjoro- Jakti said on Thursday the CGI meeting would discuss, for the first time, efforts to purge corruption and strengthen the government's system of aid disbursement.
"By the end of the (CGI) meeting we hope there will be a pledge to provide the aid we have asked for," Dorodjatun told reporters, following a meeting with ambassadors of CGI donor countries.
The CGI meeting is slated for Nov. 7 and 8 in Jakarta.
The government said it would use the CGI loans to plug next year's state budget deficit, projected at some Rp 42.1 trillion, or 2.5 percent of gross domestic product.
But plans to discuss corruption highlight CGI's concern over loan abuse reducing its beneficial impact.
Unconfirmed reports pointed at abuse totaling 30 percent of the World Bank's loans of $30 billion to Indonesia.
However, the focus of the upcoming CGI meeting would be on poverty reduction programs, Dorodjatun went on.
He said he and Coordinating Minister for Social Affairs Yusuf Kalla would lead a team to address the poverty issue.
On the economic side, the CGI agenda was set for talks on the resilience and recovery of the country's economy.
The government hopes to cushion the impact of a global economic slowdown with more loans from donor countries.
Support from CGI appears to remain firm, despite worries that the global slump would cause lenders to be less generous with their funds.
"I received plenty of signals from many countries offering their help to Indonesia, as next year will not be easy," Dorodjatun said, adding that donor countries understood the difficulties in which Indonesia found itself.
Yet, in what could be a bad sign, the World Bank said on Thursday it might not increase its lending from the current annual limit of $400 million in the CGI meeting.
A World Bank official, who declined to be named, said that unless Indonesia could meet conditions for the high-case lending scenario of a $1 billion loan facility, the bank would maintain its low case scenario. The conditions include serious action to tackle corruption.
In the past, loans from the World Bank and Japan have constituted the largest portion of CGI loans, with pledges from each amounting to some $1 billion.