Sjahril finally meets with Megawati
Sjahril finally meets with Megawati
Fabiola Desy Unidjaja, The Jakarta Post, Jakarta
Bank Indonesia governor Sjahril Sabirin and his deputies met with
President Megawati Soekarnoputri on Monday at the State Palace
for around 45 minutes, the first formal meeting between the
President and the independent central bank since Megawati assumed
power in late July.
Sjahril was accompanied by senior deputy governor Anwar
Nasution and deputy governor Miranda Goeltom. None of Megawati's
senior economic ministers participated in the meeting.
Sjahril, who is currently facing a court battle over his
alleged involvement in the high profile Bank Bali scandal,
declined to comment much about the meeting, saying only that the
central bank would continue to work closely with the economics
team to resolve the country's economic woes.
Sources said Megawati had turned down several times Sjahril's
request for a formal meeting.
Relations between the government and Bank Indonesia, which
became an independent central bank in May 1999, plunged to their
lowest level during the administration of Abdurrahman Wahid,
Megawati's predecessor, who openly demanded the resignation of
Sjahril in an attempt to cleanse the central bank of corruption.
The near-blind Abdurrahman, who was dismissed by the People's
Consultative Assembly (MPR) due to incompetency, also demanded
the amendment of the central bank law.
The demands followed an audit result by the Supreme Audit
Agency (BPK), which indicated that some Rp 138.4 trillion
(US$13.02 billion) of the Rp 144.5 trillion in central bank
emergency loans channeled to banks facing massive runs during the
height of the 1997 financial crisis had been misused. The agency
blamed the leakage on Bank Indonesia's weak supervision.
A huge proportion of the loans was channeled to banks owned by
powerful businessmen with close ties to the family of former
authoritarian president Soeharto.
As a result of the BPK audit, the government declined to cover
the cost of the emergency loan facility, putting the central bank
into near-bankruptcy. The government finally agreed to cover
part of the loans to save Bank Indonesia from bankruptcy only
after intense lobbying, facilitated by the House of
Representatives, and after several Bank Indonesia top officials
tendered their resignations, including Anwar and Miranda.
But the finance ministry is now planning to appoint a foreign
consultant to carry out a new audit to calculate the amount the
government and the central bank must each bear.
The prosecutor has demanded a four-year jail sentence for
Sjahril for abusing his power in relation to the Bank Bali scam,
which centered on the illegal transfer of some Rp 904 billion
from the bank to companies linked to the then ruling Golkar
Party.