Crisis center to provide access to policy-makers

Crisis center to provide access to policy-makers

Fitri Wulandari, The Jakarta Post, Jakarta

Indonesia's desperation to escape the prolonged crisis has
resulted in yet another decision that many view not only as
belated but also questionable as to its effectiveness.

The decision to set up a crisis center early this month,
though welcomed as a government gesture to accelerate economic
recovery, has triggered more questions than it has brought
optimism.

For one thing, there are already a number of agencies, bodies
and task forces set up after the country's economy hit rock
bottom four years ago. So far, none of the institutions has
produced satisfactory results. The center, too, which aims to
resolve problems faced by the business community, to boost
economic growth, is feared to fail due to various constraints.
For one thing, it lacks the administrative power necessary to
make it effective to solve problems faced by businesspeople.

Executive director of the center Anton J. Supit admitted on
Tuesday that to ensure effectiveness, the center should have been
led by an institution that had greater authority, such as the
president or the Office of the Coordinating Minister for the
Economy, to directly execute decisions.

However, although the center is led by the Ministry of
Industry and Trade, which has limited authority, Anton believed
it was expected to provide the business community with direct
access to the nation's decision makers.

"At the very least, Ibu Rini (Minister of Industry and Trade
Rini Soewandi) can present problems faced by the business
community to Cabinet meetings," Anton, who is also chairman of
the National Economic Recovery Committee (KPEN), said.

While also admitting the lack of political support from higher
institutions, Anton said that as a minister, Rini could lobby her
colleagues to resolve business problems.

"Ibu Rini enjoys good relations with other ministers. That
should be effective enough to coordinate related ministries,"
said Anton, who is also chairman of the Indonesian Footwear
Association (Aprisindo).

The center's main focus will be to solve problems in the
manufacturing sector and trade, the major contributors to
Indonesia's economy. Indonesia's economy needs to grow at a
respectable rate of 6 percent per year so as to be able to absorb
huge numbers of unemployed. In order to arrive at the growth
rate, exports and investments must be pushed, as the cash-
strapped government can no longer be relied upon to revive the
country's economy.

But local and foreign investors have been facing various
problems in the country.

Labor conflicts, smuggling and security problems are some of
the issues that have contributed to the continuing decline of
foreign direct investment and exports.

In this regard, the center is expected to serve as a forum for
government officials and businesspeople to discuss and resolve
problems encountered in the manufacturing sector and trade.

However, analysts doubt that the center will be effective as
many problems faced by manufactures and traders are beyond the
authority of the Ministry of Industry and Trade.

They argue that it should be led by President Megawati
Soekarnoputri, or at least placed under the Office of the
Coordinating Minister for the Economy for better coordination and
cooperation from other related ministries.

A higher authority is needed to make fast decisions and take
concrete action, as well as to reduce red tape, as the center is
expected to act like a troubleshooter.

At present, the Center is gathering reports from the business
community and listing them, based on their urgency with which
they should be discussed at a panel meeting led by Rini and her
staff.

For eyebox

Govt fond of setting up task forces

Since the economic crisis hit the country in 1997, the government
has set up several task forces in its attempt to help accelerate
economic recovery.

The National Economic Council (DEN) and the National Business
Development Council (DPUN) were the first two set up by the
government in December 1999, during the previous administration
of Abdurrahman Wahid.

DEN consisted of 18 senior economists led by noted economist
Emil Salim, with the main task of advising the president on
macroeconomic policy. The members included economist Sri Mulyani
Indrawati and agriculture expert H.S Dillon.

DPUN's members were businesspeople led by Sofjan Wanandi. It
was tasked to advise the president on how to revive business
activity and create jobs to absorb huge unemployment.

The two bodies only lasted a year. In 2000, the president
abolished DEN and DPUN. The Indonesian Chamber of Commerce and
Industry then formed the National Economic Recovery Committee
(KPEN) on Sep. 5, 2000. KPEN's 32 members were several Indonesian
business magnates, such as Kadin boss Aburizal Bakrie, James
Riady, Subronto Laras, and also Sofjan Wanandi.

KPEN is intended to continue DPUN's main program, which is to
push for job creation to reduce unemployment and support small-
scale businesses.

Having established different task forces, the country's main
economic problems remain untouched. Even job opportunities have
not materialized.