Govt sets up special team to curb imports

Govt sets up special team to curb imports

JAKARTA (JP): The government has established a special
monitoring team to curb the sharp growth in imports, noted
economist Emil Salim said yesterday.

Emil, the former state minister for population and
environment, said that the team, established on Tuesday, would
closely monitor the spending of government and state-owned
companies on imports.

Emil said that the establishment of the team, headed by
Coordinating Minister for Economy and Finance Saleh Afiff,
indicated the government's serious commitment to reducing
unnecessary imports.

"The team is necessary because, as you'll know, the government
represents the largest buyer of imports," he said.

Emil said that the government has spent trillions of rupiah in
the past few years importing construction materials for office
building projects.

"State-owned companies also spent a large amount of money on
imports," he said.

The team, whose establishment has not been formally announced,
reflects the government's desire to tackle Indonesia's growing
current account deficit. The team is expected to complement the
activities of the government's commercial loan monitoring team,
established five years ago to keep tabs on the inflow of
commercial loans into the country.

Minister of Finance Mar'ie Muhammad earlier estimated that the
current account deficit would rise to US$7.9 billion in the
current fiscal year from an estimated $3.49 billion in the
previous year due to the higher growth in imports than exports.

Imports grew by 32.4 percent during January-September period
of last year with imports of consumer goods rising by 70.9
percent. For comparison, non-oil exports grew by only 14.2
percent during the same period to $25.14 billion from $22.02
billion in the same period of 1994.

However, some analysts doubt whether the government can really
slash the growth of imports.

Bank Indonesia Governor J. Soedradjad Djiwandono was
optimistic, however, that the growth of imports could be reduced
to as low as 11 percent.

He noted that Indonesia has experienced sharp fluctuations in
import growth. Imports grew by 21.3 percent in the 1989-1990
fiscal year. The import growth rate increased to 31 percent in
the 1990-1991 fiscal year but dropped drastically to 11.4 percent
in 1991-1992, then it fell further to 9.7 percent in the 1992-
1993 fiscal year and to 6.6 percent in 1993-1994.

"So it's not impossible to reach our target," Soedradjad said.
(pwn/hen)