Crisis threatens development

Crisis threatens development

JAKARTA (JP): President Soeharto in his accountability address
to the People's Consultative Assembly (MPR) bemoaned that events
of the past few months have exposed internal weaknesses and
threatened to undermine the country's hard built development.

In an hour-long speech accounting for his performance as
President during the 1993/1998 term, Soeharto stated that until
the advent of the economic turmoil the nation's development was
proceeding smoothly, with many development targets being achieved
or even surpassed.

But this success came under threat in the middle of 1997 from
the severe economic crisis affecting Southeast Asia.

"Since the second half of last year, when the monetary turmoil
struck, it seems that everything we have built with great
difficulty, sometimes with pain and sacrifices, was all of a
sudden undermined," he said.

Average economic growth which between 1993 and 1996 stood at
7.1 percent annually, dropped to just 4.7 percent last year.

While maintaining that the country's economic fundamentals
were sound, Soeharto admitted that the crisis had exposed major
weaknesses in nation.

"Apparently our economic resilience was not strong enough to
withstand external blows... Apart from external influences, some
of the hardship we are suffering today is also due to our own
internal weaknesses," he remarked.

The speech was delivered yesterday to the 1,000-member MPR.
The Assembly meets every five years to listen to and then assess
the presidential accountability speech, endorse the State Policy
Guidelines, and elect the president and vice president.

According to Assembly speaker Harmoko, who opened the session,
997 assembly members attended the proceedings. The absent three
-- Latif Muchtar, Nurdin Abdul Rachman and former Coordinating
Minister for Political Affairs and Security Soesilo Soedarman --
were deceased.

The start of yesterday's proceedings coincided with the
historic "Six hours in Yogya" attack led by a young Lt. Col.
Soeharto in 1949.

The end of the session on March 11 also coincides with an
historic anniversary. On the same day in 1966, the late president
Sukarno issued a letter delegating power to Lt. Gen. Soeharto
authorizing him to take necessary steps to ensure the integrity
of the state.

Since being appointed President in 1968, Soeharto has led the
nation from a state of impoverishment to one of the fastest
growing and most successful economies in the world.

Many predicted that his sixth-term in office would be crowned
by a further strong economic performance this year.

But the tumultuous effects of the monetary crisis were not
lost on the 76-year-old President.

"I share the sadness of housewives and low-income families in
dealing with the rocketing prices," he remarked adding that "our
economic lifeline has begun to be compromised."

But the country, Soeharto said, should not look for scapegoats
in this crisis.

Along with various tragedies, accidents and natural
catastrophes such as a long drought and forest fires, the
President described 1997 as "a year of great concern."

Aside from addressing the crisis, Soeharto devoted a large
part of his speech noting highlights of the last five-years,
pointing out that many targets set-out in the Sixth Five-Year
Development Plan (REPELITA VI) of 1994/1999 had been reached, or
nearly reached.

Among those outlined by the President were:

- Economic growth rates of 7.3 percent, 7.5 percent, 8.2
percent and 8.0 percent from 1993 to 1996.

- Per-capita income rose from the 1993 level of US$842 to
$1,155 in 1996. In denominated in rupiah, the 1997 per capita
income of Rp 3.1 million exceeded the REPELITA VI target of Rp 3
million.

- Poverty alleviation programs have reduced the number of poor
from 25.9 million in 1993 to 22.5 million in 1996.

- Life expectancy has increased from 62.7 years in 1993 to
64.2 years in 1997. Meanwhile mortality rates have sharply
declined. Infant mortality dropped from 58 per 1,000 births in
1993 to 52 in 1997. Maternal mortality has declined from 425 per
100,000 births in 1993 to 390 in 1994. Overall gross mortality
has also been reduced 7.9 per 1,000 inhabitants in 1993 to 7.5 in
1997.

* The number of 'simple' and 'very simple' houses constructed
is over 550,000, in excess of the REPELITA VI target of 500,000.

* The rising size of the Indonesian workforce, from 81 million
in 1993 to 88.2 million in 1996, has been accompanied by a
continuing rise in the minimum wage, which in 1997 was judged
sufficient to provide 95.3 percent of the minimum physical needs.

* Dependency on exports of oil and gas goods continued to
decrease. Non-oil and gas exports rose from $23.3 billion in 1993
to a predicted $34 billion in 1997. This accounts for 65 percent
of national exports.

Politics

Soeharto only made a fleeting reference to political
developments in the country.

He acknowledged that "the political climate was quite tense"
prior to last year's general election, but blamed it on people
who were "not yet mature enough to put democracy into practice
and misused freedom and openness."

He took a stab at critics of Indonesia's electoral process,
saying that nine out of 10 eligible voters exercised their voting
right. "Far higher than in other countries which have enjoyed
hundreds of years of political tradition," Soeharto said.

Very early on in his speech Soeharto also commended the work
and dual function of the Armed Forces, which he said has made a
meaningful contribution to national stability and political life.

Soeharto praised the Armed Forces' work in maintaining
security despite their limited budget and personnel.

Speaking separately yesterday afternoon at a farewell
reception with the outgoing cabinet at Merdeka Palace, Soeharto
said it is entirely up to the Assembly to decide on the
acceptability of his accountability speech.

"If they accept it we should be thankful (to God), but even if
they don't we should still be thankful ... for having given our
best we can in the future learn and do better," Soeharto said.
(team)