Ginandjar, IMF discuss reform programs

Ginandjar, IMF discuss reform programs

WASHINGTON (Dow Jones): Ginandjar Kartasasmita, Indonesia's
coordinating minister for economics, finance and industry, said
Monday after a meeting with IMF Managing Director Michel
Camdessus that they discussed the challenges still facing the
Indonesian government in its reform program, particularly
combating corruption and devising a new "mechanism" for
proceeding with corporate bankruptcies.

Ginandjar reiterated his opposition to the introduction of
capital controls or any alteration of the floating system for the
rupiah as means of encouraging bringing greater stability in
local financial markets.

"Definitely we are not going to follow that direction," he
told reporters when asked whether he favored the kind of capital
controls adopted by Malaysia during the Asian financial crisis.

He said Indonesia's economy isn't the same as Malaysia's and
that he had "philosophical" objections to such curbs on market
freedom.

Ginandjar said Indonesia's strategy to rescue the economy from
its current slide remains "on track" and that both Camdessus and
Wolfensohn remain supportive of his government's plans.

He said the government has made ground in stabilizing the
rupiah, bringing down inflation and lowering interest rates.

The "very important agenda" now facing the government,
Ginandjar said, contains three goals: the restructuring of the
banking sector; confronting the massive debt burden carried by
the private sector; and conducting general elections in June.

On bank restructuring, Ginandjar said a list of Indonesian
banks that will face closure under new capital requirement
guidelines will be finalized by the end of February or early
March and the process of refinancing or closing individual banks
should be underway before the election in June.