Economic reform drive needs reinvigorating
Prof. Sumitro Djojohadikusumo made some strong remarks recently when he criticized the government for its lethargy in bringing about economic reforms. The Indonesian economic guru appeared impatient on observing the pressing problems that need to be immediately addressed.
Prof. Sumitro's criticism has reinforced suspicions that internal constraints are weakening the government's reform drive despite the fact that the need for such measures has been recognized by the authorities concerned. The professor pointed a finger at vested interest groups which are inclined to preserve the current situation so they can continue to gain and retain their privileges.
The government, Prof. Sumitro said, must muster a strong political will to combat those vested interest groups. Many problems in the real sector still need to be tackled to expedite the flow of goods, eradicate high cost economy conditions and eliminate monopolies on certain commodities.
We support this view. While we do not wish to belittle the advances and achievements that have been made so far, we also cannot close our eyes to the various problems that are still restraining the pace of our economic growth. The indicators are there for all to see -- among them, threatening inflation and overheating of the economy, a high current account deficit and a weak competitive rating of our commodities.
The government has repeatedly stated its intention to launch a deregulation packet. Initially it was scheduled to take place at the beginning of June, but this was postponed. In the absence of a clear-cut reformation framework, one can hardly blame those who assert that the stated deregulation plan is no more than a dressing to impress next month's CGI meeting.
Our economic affliction has meanwhile grown fairly chronic. There is no need for us to condemn Prof. Sumitro's strong words. To remain positive, we may take his statement as a warning that immediate action should be taken, or the situation may become worse.
-- Bisnis Indonesia, Jakarta