NGOs urge govt to drop post-IMF reform program

NGOs urge govt to drop post-IMF reform program

Fitri Wulandari, The Jakarta Post, Jakarta

A coalition of non-governmental organizations (NGOs) demanded
the government to drop its post-IMF economic reform programs as
outlined in the White Paper document, arguing that many of the
programs would not help improve the welfare of the people and
went against the Constitution.

The protest from the NGOs comes as the IMF commences its final
review of the country's economic condition under its program.

The NGOs pointed out that the government's programs were aimed
at eliminating subsidies, financial liberalization, trade
liberalization and privatization of state-owned companies, all of
which were against the interest of the people.

"The White Paper is not a breakthrough and is useless as a
whole," Binni Buchori, coordinator of the International NGO Forum
on Indonesian Development (INFID) told reporters on Friday.

INFID groups several NGOs, including the Indonesian Consumers
Foundation (YLKI), Debtwatch, Working Group on Power Sector
Reform (WG-PSR), People's Coalition for Water, and Indonesian
Corruption Watch (ICW).

The government issued the White Paper in September under
Presidential Decree No. 5/2003. The document, which contains a
set of economic reform programs to be implemented 18 months from
September, was drafted ahead of plans to end the existing
International Monetary Fund-sponsored reform program when it
expires at the end of this year.

The White Paper programs cover three main goals: maintaining
macroeconomic stability, restructuring the financial sector and
improving investment, export and job creation.

While it received praise from international donors, the White
Paper -- the contents of which are not much different from the
IMF program -- received a cool response at home.

Analysts have said the programs lack a concrete action plan to
resolve the country's chronic economic problems.

Binni echoed this view, saying that under the White Paper
program, the government had no clear and concrete plan on how to
reduce the country's foreign debts.

She said the huge state budget allocation for repaying the
debts had been made at the expense of development spending at
home, and criticized the government for failing to negotiate with
bilateral donors for a debt reduction facility.

"The Minister of Finance insists there is no other way to
reduce debt stock other than to repay them, even though the House
of Representatives has urged the government to reduce debt
payment in the draft 2004 state budget by negotiating with donor
countries."

If the debt payment burden could be reduced, the funds could
be used to increase the development budget and routine budget,
she added.

She mentioned that next year, the government must spend Rp 68
trillion in foreign debt principal and interest payments.

Another flaw in the program is the lack of an action plan for
poverty alleviation.

Azas Tigor Nainggolan, coordinator of the Jakarta Residents
Forum (Fakta), said the White Paper programs only copied poverty
alleviation programs that had been widely criticized by the
public, such as Rice for the Poor (Raskin), the Urban Poverty
Alleviation Program (P2KP) and Social Safety Net (JPS).

"These programs have been known for their vulnerability to
corruption and manipulation. And the government continues to
support them," Tigor said.

INFID plans either to file a lawsuit against the government or
file for a judicial review of the presidential decree with the
Constitutional Court, if the government proceeded with the White
Paper policy.