Government urged to ease control of economy
Government urged to ease control of economy
JAKARTA (JP): Prominent economist Dorojatun Kuntjoro-Jakti
recommended that the government ease its grip on the economy and
share more of the development burden with the private sector.
"The government is getting too involved in the economic
development at the expense of other sectors' development,"
Dorojatun, the dean of the University of Indonesia's School of
Economics, said in a seminar over the weekend.
"Sometimes, its intrusions are not fitting at all," he said.
He said that the government is even involved in waste
management and the cleaning service business. "The janitors at my
school are not civil servants anymore. I gave the job to a
private company," he said.
Dorojatun said Indonesia should have a surplus in its national
account in order to cushion its entrance into the free trade era.
"A balanced account isn't enough. There has to be a surplus in
the account," he said.
Indonesia's national account for the 1995/96 fiscal year,
ending last March, did not meet previous predictions. The
government suffered an account deficit of US$7.9 billion, well
over the US$4.05 billion deficit previously estimated by the
government.
He acknowledged that one of the reasons why Indonesia's
national account is underbalanced was because the government
carries too much burden.
"The private sector could help in balancing the budget. It's
about time the government stopped being involved in building
stadiums, airports and other big projects. Hand them over to the
private sector," he said.
Dorojatun also called for a trimmed bureaucracy and greater
efficiency. "There are too many inefficient government offices.
Their administrations should be computerized and they ought to
stop hiring inefficient workers."
Dorojatun also said the government should curb its dependence
on foreign investments. "We should increase our domestic savings
rate. Our Broad Guideline of State Policies stipulates that
foreign investment is only an auxiliary."
According to the World Bank, Indonesia's domestic savings
contribute 36 percent of the nation's income.
The seminar, held by the University of Indonesia, was one of a
series of events to commemorate the school's 40th anniversary.
Other speakers featured at the seminar included former
minister M. Sadli, head of the Association of Private National
Banks Trenggono Purwosuprojo, and former Jakarta Stock Exchange
director Hasan Zein Machmud.
Trenggono said that many of the deregulations recently
introduced by the government to facilitate economic development
were not prepared thoroughly.
"The government's deregulations can turn a textile trader into
a banker overnight. Furthermore, the government sometimes
confuses the private sector. One office says we have to go left,
but another tells us to go in the opposite direction," he said.
By the end of the seminar, however, the speakers agreed that
Indonesia has shown signs of strength to cope with economic
globalization.
"We are late starters, but we have set a fantastic record
these past few years," concluded Hasan Zein Machmud. (06)