IMF director arrives to review aid program
IMF director arrives to review aid program
JAKARTA (JP): IMF Asia Pacific director Hubert Neiss said
yesterday he expected the agency to disburse its second US$1
billion bailout money to Indonesia next month.
"It could be mid July, or early July. It depends on how
quickly we finish here," he told reporters upon arrival here
yesterday afternoon.
The IMF has committed to provide $10 billion as part of a $43
billion bailout fund for Indonesia. The agency has so far
disbursed $4 billion.
The second $1 billion disbursement was initially scheduled for
June 4, but was delayed due to the country's recent political
unrest.
Neiss arrived in Jakarta to lead the IMF technical team to
review the country's economic reform programs agreed upon with
the fund in April.
This is Neiss' second visit to Jakarta in 10 days.
His last visit, during which the IMF Asia director met a
veritable who's who of the Indonesian establishment including
government members, prominent opposition leaders, even trade
unionists, was designed to help the board of the IMF decide when
it could resume lending to the beleaguered country.
Chairman of the National Development Planning Board (Bappenas)
Budiono earlier said the IMF team would not focus on reviewing
the structural reform since most of the programs had been
implemented.
He pointed out that tomorrow's discussion would center on
reviewing the country's macroeconomic targets, state budget and
social safety net program.
He was optimistic the IMF would make the second disbursement
because the country had met all the agency's criteria.
Indonesia's macroeconomic picture has dramatically changed
since the economic reform program was agreed upon earlier this
year. The current situation has deteriorated following the
political turmoil.
Analysts said the economy would contract by more than 10
percent this year with inflation surpassing 100 percent and
unemployment to reach 20 million.
They also the earlier year-end target of the rupiah exchange
rate of Rp 6,000 to the U.S. dollar was no longer realistic.
The rupiah yesterday closed at Rp 12,000 to the dollar,
compared to about Rp 8,000 when the reform program was agreed in
April. (rei)