'Donors must share blame for graft

'Donors must share blame for graft

Fabiola Desy Unidjaja, The Jakarta Post, Jakarta

International donor agencies should share the blame for
supporting corruption practices in Indonesia and failing to apply
regulations to scrutinize the disbursement of the loans, analysts
have said.

They said that donor agencies, such as the World Bank (WB) and
the International Monetary Fund (IMF), were in a position to
prevent corruption, but had refused to exercise their authority
to a maximum degree.

"They should be held responsible for the endemic corruption
and ignoring the fact that they hold the power to stop the
practice. These points underscore that they are the accomplices
of corruptors," Wardah Hafidz of the Urban Poor Consortium said
on Saturday.

She said that for decades these donor agencies were aware that
between 20 percent and 30 percent of their loans went into the
coffers of corrupt Indonesian officials, but not once did they
decide to stop channeling the assistance.

"Actually, they have regulations to ensure the transparent use
of the funds, but they have never enforced those rules strictly,"
Wardah added.

She was commenting on the World Bank's move to urge Jakarta to
step up measures against corruptors, while insisting that the
government was the only one held responsible for the rampant
corruption.

She said that despite repeated complaints and allegations of
corruption, none of the donor agencies took any measures against
the government but instead continued with the disbursement of the
funds.

The Consultative Group on Indonesia (CGI) approved on
Wednesday US$2.7 billion in fresh loans. An Indonesian official
revealed the next day that almost 20 percent of foreign aid was
misused. The report was confirmed by the Supreme Audit Agency
(BPK).

During the era of former president Soeharto, noted economist
Soemitro Djojohadikusumo said that 30 percent of foreign funds
were misused.

Wardah said the move to siphon foreign loans started from the
planning of certain projects to be funded by foreign aid.

"Each ministry, in a bid to ensure the funds would find their
way into their coffers then bribed the officials who held the
funds. Back then they were in the National Development Planning
Board (Bappenas)," she said.

"Those practices continue all the way until the designated
agency obtains the funds for disbursement to the public," Wardah
added.

Another observer from the state Diponegoro University of
Semarang, Nugroho, suggested that the government establish a
control agency with strong authority to closely observe the use
of foreign loans.

He said the supervision should start from the planning and
continue until the implementation of certain projects, paid for
by the foreign funds.

"We need more repressive measures to deal with the possible
misuse of foreign loans starting from the planning of certain
projects," Nugroho told Antara.

He said that although donor agencies had their own supervisory
office to ensure the proper use of foreign aid, they had proven
to be ineffective in stopping leakages.

Nugroho said it would be better to establish a team that was
authorized to scrutinize the use of foreign loans in all
government institutions.