Rizal hopeful about support from creditors

Rizal hopeful about support from creditors

By Kornelius Purba

TOKYO (JP): Coordinating Minister for the Economy Rizal Ramli
expressed confidence on Wednesday that problems caused by
militiamen in West Timor would have no effect on next week's
meeting of the Consultative Group on Indonesia (CGI) creditor
consortium in Tokyo.

Speaking at a news conference at the Imperial Hotel at the
conclusion of his two-day visit here, Rizal said the Japanese
government had promised not to tie political problems to economic
issues at the upcoming meeting of the creditor group.

According to Rizal, assurances were given during meetings on
Tuesday and Wednesday with Japanese Minister of Finance Keiichi
Miyazawa, Minister of Foreign Affairs Yohei Kono, Bank of Japan
Governor Masaru Hayami and Minister of International Trade and
Industry Takeo Hiranuma.

"We really appreciate the position taken by the Japanese
government to disassociate politics from our economic
performance. They are upbeat about Indonesia's economic
performance and have suggested that politics should not be a
major issue in the next CGI meeting," said the minister.

"I hope the U.S. will be wiser for the sake of the 200 million
people of Indonesia," Rizal responded when asked about the U.S.
threat to impose an economic embargo on Indonesia if it failed to
settle the militia problem.

Washington has warned Indonesia that it might face an economic
embargo if its actions on the militias failed to appease the
international community.

World Bank president James Wolfensohn also warned President
Abdurrahman Wahid in a recent letter of the consequence of his
failure to end the violence in West Timor.

Rizal briefed Japanese senior officials on the progress in
disarming the militias following the killing of three foreign
relief workers in Atambua last month.

He said the government would use force to disarm militiamen
and facilitate the repatriation of the 130,000 East Timorese or
their resettlement in other provinces in Indonesia.

"We have done a lot of things to solve problems in West
Timor," the minister said.

He praised the Japanese government and private companies, the
largest creditor and investors in Indonesia respectively, for
their strong commitment to help Indonesia survive the economic
crisis that first hit the country in mid-1997.

"During the last three years of the financial crisis, a lot of
companies left Indonesia, but many Japanese companies remain in
Indonesia," Rizal pointed out.

The minister also explained the Cabinet's 10-point economic
recovery program to the Japanese government, including the
stabilization of the financial sector, the acceleration of
banking and private sector restructuring, the increase of revenue
levels from non-oil exports, and the increase of agricultural
productivity and the welfare of farmers.

"We have accelerated corporate debt restructuring. We have
taken tough decisions to speed up debt workouts. After the CGI
meeting, we will conclude more debt restructuring deals," Rizal
added.

The CGI meeting, which will be chaired by World Bank vice
president Jamil Kassum, will also be attended by CGI members,
including the U.S., Germany, the Netherlands, Australia, Italy
and Britain.

Major international organizations, including the International
Monetary Fund and the Asian Development Bank, will also be
present.

The Indonesian government will ask for US$4.8 billion in loans
from the CGI to plug part of the huge budget deficit next year.

Rizal is scheduled to return to Tokyo later this week to lead
Indonesia's delegation to the CGI meeting. The delegation will
include nine ministers.

Separately, a visiting British minister said in Jakarta on
Wednesday that major donors to Indonesia would continue to make
new aid pledges at next week's meeting of Indonesia's creditors
in Tokyo.

"I don't think not making pledges on aid is likely to happen,"
Britain's international development minister Clare Short was
quoted by AFP as saying.

Short said she had been told that as of Tuesday only 80 light
weapons had been handed in under the militia disarmament effort
in West Timor.

"We think there's been some progress. It needs driving forward
and the international community needs to support these efforts,"
Short said.

"There will be a commitment to spend behind the reform
effort," she said of Britain's approach to the meeting.

The minister said Britain wanted to play "a supportive role in
helping drive through reforms" in Indonesia, saying there were
"genuine intentions for reforms".

"But there needs to be more progress on the ground," she
added. (prb)