IMF assistance still needed, say economists
Dadan Wijaksana, The Jakarta Post, Jakarta
Economists urged legislators and the government to join hands in implementing difficult economic reform programs in order for the country to achieve a quick recovery, and not waste time and energy in quarreling about the role of the International Monetary Fund (IMF) here.
"Continuing or discontinuing the role of the IMF in the country does not really matter when the real problems are coming from within ourselves," Sjahrir, a well-known economist, told a hearing with the House of Representatives Commission IX, which oversees financial affairs, on Tuesday.
The legislators invited Sjahrir, along with seven other noted economists, to seek input on whether the country still needed the Fund's assistance to overcome the prolonged economic crisis.
Sjahrir added that it was becoming a habit now for the country to always seek a scapegoat whenever something went wrong.
"It's not the IMF that is the problem, but it is we who have been slow in implementing the recovery programs," Raden Pardede of the Danareksa Research Institute, added.
The pros and cons are being increasingly debated over the role of the IMF, mostly triggered by a series of sharp criticisms made by State Minister of National Development Planning Kwik Kian Gie.
Moving against the direction of his fellow economics ministers, Kwik has not been hesitant in attacking some of the government's key policies that have been agreed with the Fund.
Kwik's publicly-documented criticisms of the IMF have led to a public debate with other economic ministers led by Coordinating Minister for the Economy Dorodjatun Kuntjoro-Jakti, who has repeatedly stressed the need for the country to maintain its relationship with the Fund.
Dorodjatun says the IMF's role is important for the country's recovery as it not only provides loans but more importantly it served as a barometer for other countries and international institutions in lending to Indonesia in terms of debt rescheduling and even proffering new loans.
The IMF is organizing a three-year US$5 billion loan package for the country in return for the implementation of various reform programs. The IMF program was supposed to end in November 2002, but Minister of Finance Boediono has extended the program into end of 2003.
However, Kwik, who has started to gain nationwide support, including that of prominent figures such as the Speaker of the People's Consultative Assembly Amien Rais, is of the opinion that the efforts towards economic recovery could still progress without the help of the IMF.
As the public debate seems likely to continue to be strenuous, allegations are rife that the cabinet is on the brink of cracking, putting more pressure on the already strained economy. It is against this background that the house decided to invite the economists to give their views.
All the economists present at the House hearing were agreed that in principle the sooner the country dismantled its relationship with the IMF the better, as long as there was a clear concept on how to achieve a quick recovery and there was a high level of discipline from all elements of the country in implementing tough reform programs.
"There is not a single nation in this world who wants to keep its relationship with the IMF for a long time. However, since the contract has been signed, why not honor it. Cutting the relationship in midway would risk our credibility," Umar Juoro of the Center for Information and Development Studies (CIDES) said.
"The question is not dismantling the IMF agreement, but how to utilize it," Pande Radja Silalahi of the Centre for Strategic and International Studies (CSIS) added.