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)