RI economy shows progress: Fisher

RI economy shows progress: Fisher

SAO PAULO (Agencies): Indonesia, which has been the hardest hit during the most recent wave of the Asian crisis, is showing promising progress, IMF's First Deputy Managing Director Stanley Fischer said over the weekend.

"If political stability and the reform momentum are maintained, the Indonesian government program with the IMF -- no doubt with some changes -- should provide the basis for gradual restoration of the health of the economy and investor confidence," Fischer said.

Fischer said that an IMF team is currently in Jakarta to discuss a revised program with officials, following the agency's decision last month to suspend a planned disbursement to Indonesia amid political turmoil that resulted in an end to President Soeharto's long reign.

"There is no doubt that these discussions will bear fruit, since the cooperation between the Fund and the new Indonesian economic team is very close," the IMF official said.

Fischer said that the IMF is working to ensure that the scheduled US$1 billion July loan tranche delivery is met.

"July 6 is conceivable but is no longer a target date," he said, speaking at a press conference. "We have no reason to delay the loan, we will go as fast as we can."

In Jakarta, Indonesia's Coordinating Minister of Economy, Finance and Industry Ginandjar Kartasasmita, said Friday that Indonesia and the International Monetary Fund have agreed on general parameters of the state budget.

"We will announce the results next week," Ginandjar said after a meeting between economic ministers and President B.J. Habibie.

In Tokyo, senior financial officials of the Group of Seven (G- 7) and Asian nations said in statement released after a meeting on Saturday that an early agreement between the International Monetary Fund and Indonesia was crucial.

The statement also said the participants in the meeting welcomed Indonesia's renewed commitment to reform.

The G-7/Asia meeting was held in Tokyo in the wake of joint U.S.-Japan currency market intervention on Wednesday to prop up the sagging yen, which was threatening to trigger another round of Asian devaluations.

"Deputies welcomed Indonesia's renewed commitment to economic reform and the planned political reforms announced thus far," the statement said.

"They stressed the importance of an early agreement with the IMF on an economic and structural reform program," it said.