Money laundering reports untrue: Rahardi

JAKARTA (JP): Minister of Industry and Trade Rahardi Ramelan said on Tuesday that reports of a money laundering scandal involving his wife were engineered.

Rahardi, who is also chairman of the State Logistics Agency (Bulog), said it was clear that certain people were trying to discredit his name by spreading the untrue allegation.

"Some parties are not happy with some of my industry and trade policies. So they want to ruin my reputation," he said.

He said he presumed the rumor was sparked by people who were unhappy with his policy to impose a zero percent import duty on sugar.

Harian Ekonomi Neraca daily and Tempo newsweekly magazine reported last week that Rahardi's wife Ibu Tumbu Astiani was rumored to have been apprehended by New York airport authorities on June 17 for bringing in US$600,000 in bank notes in to the country.

The sum was far above the maximum limit of $10,000 allowed by the U.S government to be brought in by foreign tourists visiting the country.

But the daily later corrected its story, saying it turned out to be completely inaccurate, while the magazine's cover story on the issue immediately included firm statements from Indonesian diplomats overseas and from Rahardi himself that categorically denied the rumors.

The reports said that Ibu Tumbu Ramelan was rumored to have been apprehended when she failed to declare the money, leading to concerns the amount was to be laundered.

Rahardi said his wife was in Jakarta that day, opening a home industry exhibition at the Sahid Jaya Hotel.

"Some of you who covered the opening ceremony of the exhibition saw her there. So it was impossible she was caught in New York that day."

Rahardi said he had no plans to sue the Neraca daily and Tempo magazine for publishing the articles concerning the money laundering allegations.

But he said he hoped the editors of the two publications would be "mature enough" to apologize to him, as they had damaged his family reputation.

"What can I say, the damage (caused by the reports) is already there. I am just hoping that they (the editors) still have ethics to send their apologies for destroying my name and my family's with their false, baseless reports."

Rahardi said reports about his wife might be engineered by people who did not agree with his policy to liberalize sugar imports.

Despite mounting criticism that the policy has hurt sugarcane farmers, he said he would stand by his decision not to impose import duty on imported sugar, because it would benefit consumers and not inflict losses on farmers.

Sugar farmers and the local sugar industry have been pushed to the brink of bankruptcy by a flood of cheap imported sugar which has hit the local market.

Lower international prices stemming from a sharp decline in demand and a stronger rupiah have made importing sugar more attractive than procuring it domestically.

According to one trader, the price of local sugar is currently between Rp 2,200 and Rp 2,500 per kilogram, Rp 1,800 higher than the price of the same quantity of imported sugar.

The government has obliged all sugar mills in Java to procure locally produced sugar at Rp 2,500 (30 U.S. cents) a kilogram to protect farmers from the falling price of sugar on the local market.

The government said it would pay the difference between the price of cheaper imported sugar and sugar grown in Indonesia.

The plan has not run smoothly, because the money -- amounting to Rp 496 billion -- has not yet been disbursed to sugar mills. (gis)