Greater efficiency called for

Greater efficiency called for

JAKARTA (JP): Indonesia needs to improve efficiency and the transparency of administration nationwide to cope with its structural economic problems, Minister of Finance Mar'ie Muhammad says.

Speaking at the fourth annual meeting of the Indonesian Moslem Intellectuals Association (ICMI) here on Saturday, Mar'ie noted that the drive should target not only government institutions but also the private sector.

The minister said the country needs more public accountability on the part of its leadership than ever before to ensure the efficiency and transparency of the national economy.

"There is a growing need for public accountability as our middle class is getting stronger and stronger. And we know what values they incorporate," Mar'ie contended.

He asked all leaders in the country to accustom themselves to public accountability and be ready to be criticized. "If not, don't become leaders," he said.

Mar'ie then described the structural problems faced by the nation, which have been caused by various factors, including a high cost economy, unfair competition among business people and disparities between the rich and the poor, between urban and rural areas, as well as between the western and eastern parts of the country.

The high cost economy has been caused partially by mark-up practices -- artificially raising the costs of projects above their real values -- over the last several years and a number of inefficient trade regulations, Mar'ie said.

Bill

He said the government is preparing a bill on fair competition to deal with unhealthy business practices. The bill is to be submitted to the House of Representatives later this year for deliberation.

In order to come to grips with the problem of the widening disparity between the rich and the poor, Mar'ie explained that the government has designed and applied many measures to strengthen the businesses of small-scale enterprises and cooperatives, even though not all of them are successful.

The measures include the introduction of special credit facilities for small-scale enterprises, the establishment of venture capital companies, the allocation of a certain portion of state companies' profits for small enterprises and partnership between large and smaller business entities.

Speaking on the same occasion, Minister of National Development Planning Ginandjar Kartasasmita warned that such an economic gap is the most dangerous threat to the nation's unity.

"Factors which may disrupt our stability and unity as a nation, in my personal opinion, are no longer those related to deep-rooted cultural attitudes and traditions, such as the beliefs of various religious and ethnic groups, but are now related to the economic gap," Ginandjar told the meeting which was attended by ICMI executives from across the nation and representatives from Africa.

He explained that the problem of "primordialism", a term which he used in the context of deep-rooted cultural attitudes, has diminished, but that jealousy among the various groups in society, especially that of poorly-paid laborers towards the higher income segments of society, has emerged as a result of the economic gap.

"If these laborers are organized, it will be dangerous," Ginandjar warned.

The draft state budget for 1995-1996 fiscal year, which begins in April, is meant to cope with the danger of the economic gap by putting more weight on the equal distribution of wealth than on economic growth and stability, he said.

Out of the planned rupiah spending of Rp 19 trillion (US$8.6 billion) for development programs, Rp 7.3 trillion, or 38.6 percent, will be allocated for local administrations for their own development projects, the minister said.

The government is also committed to increasing the amount of poverty alleviation funds going to 22,097 least-developed villages by 21.7 percent to Rp 473.7 billion, of which some 70 percent will go to villages outside of Java.

Ginandjar, also chairman of the National Development Planning Board, said that the draft budget pays special attention to eastern Indonesia in order to lessen the disparity between the western and eastern parts of the country.

For example, out of the planned irrigation spending, for which a 21 percent budget rise to Rp 2.04 trillion is expected, 60.8 percent will be used to finance projects outside of Java.

The government will also devote its attention to building roads and ports in eastern Indonesia.(rid)