Habibie defends approach to graft

Habibie defends approach to graft

JAKARTA (JP): President B.J. Habibie defended on Monday his
cautious and legalistic approach to eradicating corruption,
saying he refused to be rushed by public opinion over a highly
politicized issue.

"We cannot rush and be reckless in our investigation and in
pushing for a prosecution, especially if the evidence for a trial
is incomplete and unconvincing," Habibie said in his state of the
nation address broadcast nationwide.

"We could, for the sake of popularity for example, take a
shortcut by using power to drag those already condemned guilty by
public opinion to court and have them convicted," he said at a
plenary session of the House of Representatives.

"But once we adopt this unfair method, we are condoning
violations against the principle of upholding justice and human
rights, which are central themes of reform. Moreover, if we took
that approach, we'd be going back to the old practice of using
force and not a legal approach in handling corruption, collusion
and nepotism."

Although Habibie did not name former president Soeharto in his
speech, his reference to corruption investigations was clearly an
attempt to stave off criticism over the slow investigation into
the alleged corruption of his former mentor.

The Attorney General's Office, which is leading the corruption
investigation, earlier stated that it did not have sufficient
evidence to try the former strongman.

Habibie asserted that his administration had worked hard to
eradicate corruption, collusion and nepotism, stating that
investigations had uncovered cases involving Rp 7.2 trillion in
state funds. He said politically loaded cases received more
public attention.

Some Golkar leaders have urged that Habibie's presidential
candidate status be withdrawn because of his reluctance to
prosecute Soeharto, and more recently, because of allegations
that the President and his close associates were implicated in
the Bank Bali scandal.

In his speech Habibie congratulated the Indonesian Democratic
Party of Struggle (PDI Perjuangan) for winning the most votes in
the June general election. The praise was also extended to
Golkar, the United Development Party (PPP), the National
Awakening Party (PKB), the National Mandate Party (PAN) and the
Crescent and Star Party (PBB) as the six top parties in the vote
count.

Habibie's inclusion of PBB among the parties that passed the
minimum 2 percent threshold to have the right to contest the next
election in 2004 contradicted the last result announced by the
General Elections Commission in which PBB polled 1.94 percent.

He challenged other political leaders to present their vision
for the nation during the People's Consultative Assembly (MPR) in
November, stressing that his agenda would be revealed in a speech
to open the Assembly.

"You won't find the details in today's speech. I reserve them
for November."

Underlining a free press as one of the pillars of democracy,
Habibie said the media should function as an effective form of
social control to ensure good governance.

"The mass media should avoid pursuing the sensational. They
should give priority to conveying the truth to the general
public. Disclosing the complete facts could help the process of
enlightening the nation's life. But the dramatization of partial
facts and concealment of others are violations of ethics and are
irresponsible."

Habibie only paused in his two-hour speech on one or two
occasions. The first time he revealed to the audience that he was
not allowed to drink because he was fasting.

"But this does not in anyway affect my spirit," he quipped.

Habibie underlined his determination to uphold human rights
principles, citing the various United Nation's conventions
ratified by the government during his short presidency.

He said he upheld equal opportunity in all spheres of life, a
statement contrary to his supporters' use of the issue to derail
the presidential bid of his main rival, Megawati Soekarnoputri of
PDI Perjuangan.

After pausing briefly, apparently for effect, Habibie said:
"We have to eliminate all forms of gender bias in politics,
economics, law, business, science and technology, and even in the
military and police."

The President addressed the Aceh issue generally, but did not
offer any new proposals to resolve the province's increasingly
volatile situation. He said he would consider the House's plan to
define the province's "special territory" status.

On the military, the President said the decision to change the
name ABRI (Armed Forces) to TNI (National Military) -- which
coincided with the separation of the National Police from the
military on April 1 -- was to distance TNI, described as
"pioneers of reformation", from criticisms of past military
practices.

Habibie defended his decision on the popular consultation in
East Timor, in which East TImorese will choose whether they want
to remain part of Indonesia under a special autonomy arrangement,
or be separated from the republic.

In an apparent response to predictions made by many foreign
analysts that voters would choose independence, Habibie said the
outcome would not undermine the unity of the Indonesian republic.

Addressing criticisms on the slow pace of reform, Habibie
explained his "accelerated evolution" approach, which he said
called for gradual and orderly changes. He said such changes were
low risk compared to the alternative of a revolution with the
accompanying dangers of violence.

Habibie highlighted economic indicators which pointed to the
country's recovery:

* Positive gross domestic product (GDP) growth rates for two
consecutive quarters, 1.34 percent and 0.47 percent respectively
in the first and second quarters of 1999.

* Stable prices, with five consecutive months of deflation
since March.

* A stronger rupiah exchange rate, reaching Rp 6,700 in July.
Although the rupiah returned to about Rp 8,000 this month, this
was still better than Rp 15,000 at the peak of the economic
crisis last year, he said.

* Falling interest rates, to less than 13.5 percent currently,
from over 70 percent in August last year.

* Stronger foreign reserves at US$26.5 billion against $18.7
billion a year ago.

* Return of foreign investors as shown by the composite share
price index of the Jakarta Stock Exchange at 550, compared to 250
in September.

The President acknowledged that while these figures were
encouraging, "the economy is far from fully recovered...
Moreover, the process of economic recovery is still disrupted by
waves of demonstrations, security disturbances, and unfounded and
destructive rumors".

Habibie outlined his economic agenda for the "long journey
toward recovery":

* Restoring a climate conducive for local and foreign
investors.

* Completion of the bank restructuring and recapitalization
programs. (prb/emb)