Koehler to meet Gus Dur on Monday

Koehler to meet Gus Dur on Monday

JAKARTA (JP): Newly appointed International Monetary Fund
(IMF) managing director Horst Koehler is scheduled to meet
President Abdurrahman Wahid (Gus Dur) on Monday morning during
his one-day visit here to discuss the country's ongoing economic
reform program, according to a source at the fund.

The source said that Koehler would hold a news conference at
noon at the Grand Hyatt Hotel in Central Jakarta.

Coordinating Minister for the Economy, Finance and Industry
Kwik Kian Gie, and Minister of Finance Bambang Sudibyo held a
welcome dinner for Koehler on Sunday evening.

Koehler declined to provide comments upon his arrival at the
hotel late on Sunday.

Asked if the IMF would support Indonesia's plans to impose
some form of capital control, he said: "I will talk with everyone
who's interested in it, but not tonight ... There will be a news
conference tomorrow."

But Koehler was quoted by Reuters upon his arrival at the
airport as saying that the issue of capital control would be
discussed with the President at their meeting.

"I will discuss it with the President," said Koehler.

"The IMF supports Indonesia in making a strong recovery and
reducing poverty, that's our objective," he added.

Koehler is visiting Jakarta as part of a five-nation Asian
tour. He has visited China, Thailand and South Korea. He will
leave for India after Jakarta before flying back to Washington.

Koehler, a German national, was appointed to the IMF's top
post in March, replacing Michel Camdessus.

His visit to Jakarta was made after the IMF approved on Friday
a US$372 million loan to help Indonesia finance its key economic
reform program.

The loan is the second installment in a three-year $5 billion
economic bailout package agreed between the newly appointed
administration of Abdurrahman and the IMF in January.

The release brings the total disbursements to Indonesia to
$715 million.

The second loan was supposed to be disbursed in April but was
delayed due to dissatisfaction with the slow progress in the
country's economic reform program.

Indonesia was hit by a financial crisis in the middle of 1997
which led to its worst economic crisis in three decades. The
country first signed an economic reform package with the IMF in
November 1997. The fund had organized a $10 billion bailout
package.

Koehler's visit to Jakarta comes amid reports that the
government is considering imposing some form of capital control
to help strengthen the ailing rupiah.

Koehler himself made a surprising comment last week in Bangkok
that discussions about capital controls were not taboo.

Reports that the government was considering to implement some
form of capital control helped strengthened the exchange rate of
the rupiah against the U.S. dollar on Friday to close at Rp 8,385
per dollar compared to Rp 8,630 on Wednesday. But this was still
far from the government's target of Rp 7,000 per dollar for this
year.

The rupiah plunged to a seven-month low last month amid
concern over domestic political infighting and security problems.
(rei)