Fischer, Rizal review RI reforms
Fischer, Rizal review RI reforms
DAVOS, Switzerland (Dow Jones): A top official from the International Monetary Fund has met with Indonesia's senior economic minister to discuss the country's progress on reform, but no agreement on unblocking a US$400 million tranche of IMF loans under the $5 billion bailout program was reached.
"We reviewed the situation - this was not a negotiation," IMF Deputy Director Stanley Fischer told journalists Saturday on the margin of the World Economic Forum here.
Fischer wouldn't be drawn on any timeframe for a decision on the loan installment, which the IMF delayed last month after Indonesia failed to complete a number of economic reforms under a letter of intent with the Fund.
On Friday, Indonesia's Senior Economics Minister Rizal Ramli told Dow Jones Newswires he is confident his country will meet the IMF's conditions, and said he expected an agreement on the loan package.
But Rizal noted a formal decision would require a technical review by a team from the IMF.
On the sale of nationalized Bank Central Asia - one of the IMF's conditions - the government is moving towards privatization "early this year - we have already proposed to Parliament to do that."
Rizal stressed the strength of Indonesia's economic recovery, noting that all indicators point to a much better than expected turnaround in 2000, after near-zero growth in 1999.
Rizal said gross domestic product increased by 4.8 percent in 2000, while exports rose 23 percent and retail sales rose 12 percent. Electricity usage increased by 11 percent, and capacity utilization rose to around 70 percent-80 percent, from 50 percent-60 percent the previous year.
The budget deficit, meanwhile, was smaller than expected, at 3.2 percent of GDP, showing "the government is very conservative," the minister said.
"We are on the right track, and we have to keep the momentum going," Rizal said. "Of course we have to be careful of the slowdown of the U.S. economy, but since most of our products are competitive we are optimistic we will be able to increase our market share."