RI will overcome crisis with IMF help: Soeharto

RI will overcome crisis with IMF help: Soeharto

KUALA LUMPUR (AFP): President Soeharto expressed confidence
here yesterday that his country will overcome its economic crisis
amid strong fundamentals and support from the international
community.

"Indonesia has been badly hit by the currency crisis. We know
and we are trying to overcome this," he said at a news conference
after a three-day summit of the Group of Fifteen (G-15)
developing nations.

In his first public comment on the US$38 billion bailout for
Indonesia led by the International Monetary Fund (IMF), he said
"we are convinced that we will be able to overcome this because
based on the economic aspects, our fundamentals are still
strong."

"We do have programs and we have invited the IMF to study
these programs," he said, referring to the economic reforms
launched by Jakarta to meet the expectations of its creditors,
including the closure of 16 troubled banks and government
financial belt-tightening.

"These programs have been agreed upon and the IMF along with
the World Bank have given their support and then assisted us
financially," he said.

He said the crisis was "a matter of confidence in our rupiah,"
noting the sharp decline in the currency's value in recent months
and its rise after the IMF rescue plan was announced last
weekend.

"The Indonesian crisis is actually now a matter of confidence
in the rupiah and this is what we are trying to revive," he said,
adding that the support his country had received "has been
fruitful."

Meanwhile, a U.S. official said here yesterday that U.S.
banking experts would provide assistance to Indonesia over
financial reforms attached to the IMF economic bailout.

Experts from the Federal Reserve Bank and the Federal Deposit
Insurance Corporation (FDIC) will be among officials helping
Indonesia deal with its reforms, Timothy Geithner, U.S. assistant
secretary for International Affairs said in Jakarta yesterday.

"Experts from the Fed and the FDIC will provide technical
assistance as part of the World Bank and IMF team dealing with
the financial system," he said.

The IMF announced its bailout package last week to help
Indonesia out of a financial and banking crisis sparked by the
regional currency meltdown that occurred after Thailand devalued
the baht on July 2.

"In addition to this financial support through the
international financial institutions, the U.S. authorities will
play an important role in helping efforts by the Bank of
Indonesia to strengthen the financial system," Geithner said at
the end of a one-day visit.

"The markets have reacted quite favorably to the program so
far, which is a testament to the speed, clarity and force with
which the authorities have acted and the credibility of the
authorities' commitment to a strong program, " he said.

He also said the United States participation "is a signal of
the importance we attach to successful efforts here in Indonesia
and in the region as a whole to restore financial stability."

The rupiah has fallen to as low as 3,870 to the U.S. dollar
but was trading around 3,270 at midday Wednesday. It had closed
at 3,260 on Tuesday, boosted by the IMF rescue plan and reforms
undertaken by Jakarta.

Strong Malaysian trade surplus and hopes Thailand might be
close to finding a new leader also pulled Southeast Asian
currencies out of the doldrums yesterday.

In Malaysia, the ringgit jumped to highs of around 3.2650 to
the dollar from around 3.3200 at midday after Finance Minister
Anwar Ibrahim said Malaysia posted a 1.21 billion ringgit trade
surplus in September.

In Thailand, the baht was at 38.90/39.05 to the dollar onshore
at 1030 GMT against 39.46/66 six hours earlier and 38.65/38.80
late on Tuesday. Offshore baht was at 39.00/20 against 39.50/60
earlier.

Editorial -- Page 4

G-15 -- Page 10

Rupiah -- Page 11