Political will key to economic reform: Analyst

Political will key to economic reform: Analyst

JAKARTA (JP): Indonesia's economic turmoil may lead to a
crisis of confidence if the public loses faith in the
government's ability to carry out bold economic reforms.

Political analyst J. Kristiadi said only the will of the
government could make a consistent and conscientious economic
program which would allow the country's economy to bounce back.

"Despite the international rescue package, people have started
to lose confidence because the government has not carried out its
economic reforms from the heart," Kristiadi, a researcher at the
Center for Strategic and International Studies, said over the
weekend.

The rupiah continues to plunge drastically despite the
announcement of a bailout package in November by the
International Monetary Fund (IMF).

Rumors of President Soeharto's ailing health pushed the rupiah
past the 5,000 mark against the dollar last week.

Kristiadi maintained that the people were starting to doubt
the government's policy to stabilize the national economy because
it lacked boldness and transparency.

The government closed 16 insolvent banks as part of the IMF
economic rescue package early last month, but failed to, among
other things, lift the National Logistic Agency's monopoly on
wheat flour distribution for the next three to five years, or
include the widely criticized Timor national car project in the
list of rescheduled projects.

Kristiadi said the restarting of several major projects, which
previously fell under the "review category", highlighted the
government's inconsistency.

"The government should have given a clear sign of its
determination because its economic reform has failed to stop
public doubts from prevailing."

He urged the government to learn from the strict measures
being taken by neighboring countries to tackle the monetary
crisis.

Anxious

Former home affairs minister Rudini dismissed speculation that
the economic turbulence would lead to a motion of no-confidence
against the government.

Instead, certain groups should be blamed if the people cause
disturbances or force a succession of the national leadership, he
said.

"The public were anxious even before the currency turbulence
hit the country because of unfair treatment by local government
officials. But they don't know a lot about the economic crisis
the country is now facing," Rudini, who chairs the Institute of
Strategic Studies of Indonesia, said.

People suffering from unfairness and dire economics were the
most vulnerable and easily provoked by a third party, he said.

"(The third party) will incite these people to achieve their
objectives because they no longer find constitutional mechanisms
feasible."

Rudini urged government officials to be aware of how the
public perceived their conduct and listen more to demands from
the grass roots.

And the government should not be held singularly responsible
for the economic upheaval, he added.

"The government should not apologize for the crisis. The most
important thing is how to ease the people's disenchantment as
quickly as possible."

Commenting on the possibility of national leadership
succession, Rudini said that the People's Consultative Assembly
should pick candidates other than the incumbent President
Soeharto for the presidency.

"(Soeharto) has reminded us that he might step down, but
Golkar insists on renominating him. We should have an alternative
candidate because he might turn down another term." (amd)