CGI to convene in February, first time in Jakarta

CGI to convene in February, first time in Jakarta

JAKARTA (JP): Indonesia's major donors grouped under the so-
called Consultative Group on Indonesia (CGI) will convene in
February in Jakarta for the first time to decide on a new loan
commitment for the country, according to the World Bank country
director for Indonesia Mark Baird.

Baird said a preliminary meeting of donor representatives in
Jakarta would be held in the middle of this month.

"It's been proposed that the meeting be held in the first week
of February, possibly here in Jakarta for the first time. So this
will be quite a change," he told reporters on the sidelines of a
ceremony to launch the bank's public information center.

"I think the focus of the next CGI meeting will be on how to
use resources effectively," Baird said.

"As you know this government is very keen to limit external
borrowing and to make sure opportunities for corruption are
minimized," he added.

The World Bank chairs the CGI, which traditionally holds its
annual meeting outside Indonesia sometime in the middle of the
year.

The upcoming meeting is also the first encounter between CGI
and Indonesia's new government, formed in October.

Coordinating Minister for Economy, Finance and Industry Kwik
Kian Gie said recently that the government wanted to receive a
lower amount of CGI aid next year in a bid to lessen the
country's dependence on foreign loans.

CGI pledged US$5.9 billion in aid during its annual meeting
last July.

Kwik also said the Netherlands would join again the upcoming
donors meeting after seven years of being excluded from the
grouping.

Former president Soeharto ruled out the continuation of
financial assistance from the Indonesia's former ruler in 1992
after accusing then Dutch development cooperation minister Jan
Pronk of meddling in Indonesia's domestic affairs.

Baird said the outbreak of the controversial Rp 9.6 trillion
Texmaco loans early this week would not necessarily delay the CGI
meeting or the World Bank programs in Indonesia.

"At this stage we're very pleased at the way the government is
handling the issue," Mark said.

"And we don't see any links to our future programs," he added.

He said the bank was very pleased to see that the attorney
general took follow up measures immediately after State Minister
for Investment and the Empowerment of State Enterprises Laksamana
Sukardi revealed the alleged Texmaco scandal at a parliamentary
hearing session.

Baird expected further follow up measures "to make sure we
know the full facts and any necessary actions taken".

The Texmaco Group, an integrated giant textile industry,
obtained $754 million and Rp 1.9 trillion in preshipment trade
facilities from state-owned Bank BNI between 1997 and 1998 which
it used to repay its short-term overseas loans.

Laksamana dubbed the loan transaction as "high level
collusion" because of the personal intervention of former
president Soeharto that made it possible.

Laksamana said that the central bank had to use part of its
valuable foreign exchange reserves in Bank BNI to enable the
latter to bail out Texmaco.

Attorney General Marzuki Darusman named on Thursday Marimutu
Sinivasan, the owner of Texmaco, as a suspect in the alleged loan
scandal.

The Attorney General's Office slapped a travel ban on
Sinivisan and also on the latter's brother Marimutu Manimaren and
Texmaco commissioner Wairo.

Meanwhile, the World Bank office in Jakarta officially opened
on Friday its public information center (PIC).

"(The PIC) represents a big part of the bank's ongoing efforts
to be more open and transparent in its work by expanding public
access to the bank's material," Mark said.

The PIC houses a range of operational documents that were
previously restricted to official users, plus approximately 5000
World Bank publications. (rei)