Rupiah too weak: Soedradjad

Rupiah too weak: Soedradjad

HONG KONG (AP): Indonesia's former Bank Indonesia (BI)
governor J. Soedradjad Djiwandono said yesterday that the recent
weakening of rupiah was caused purely by social unrest and that
it should be stronger.

Speaking after a conference on Asia's economies in Hong Kong,
Soedradjad said international investors have a long and
insatiable wish list which Indonesia found it almost impossible
to meet.

He said the rupiah should have strengthened after Indonesia
delivered the promised reforms and the International Monetary
Fund agreed to disburse the aid money.

"Instead, investors are now focusing on the social and
political factor," he said. "The market is demanding a lot and
one can't produce everything in one go."

The Indonesian currency closed at 9,620 rupiah to the dollar
yesterday, down from its closing level Wednesday of 9,050 rupiah,
as rioting spread from the North Sumatra city of Medan to nearby
towns.

The rupiah has fallen more than 16 percent since Tuesday when
price rises took effect as part of a wider economic reform
package to win financial aid from the International Monetary
Fund.

Soedradjad said he was surprised that the first budget
delivered by President Soeharto in January was widely denounced
by the international community.

"It said it was a lousy budget without looking into some of
the details which were good," Soedradjad said. "When
international confidence is lost, everything is black and white."

He said the immediate concern of Indonesia is "to survive."