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)