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)