Soeharto launches savings drive

JAKARTA (JP): President Soeharto yesterday urged the public, including students, to save more money so the country could lessen its dependence on foreign aid to finance its development programs.

When launching the national savings campaign here, Soeharto asserted that foreign aid, which must gradually be reduced, is only supplementary to the development financing.

"Up to now we are still receiving foreign aid to finance our development," Soeharto said. "But from the beginning, we have been determined that in the end we must shoulder all the financial burdens of development ourselves."

With foreign debts of $100 billion, Indonesia is one of the largest debtor countries in the world. Last July, donor countries and development agencies pledged Indonesia $5.36 billion in aid, up from $5.2 billion in 1994.

As Indonesia is entering the group of middle-income countries, it can no longer tap more offshore soft loans, Soeharto said. Yet, Indonesia needs more funds for its development programs.

In his state address before the House of Representatives last month, Soeharto raised the target of investment needed during the current five-year development plan period, ended in March 1999, to Rp 815 trillion ($360 billion) from the original target of Rp 660 trillion.

Soeharto said that to be more independent in development financing, the government has to raise more funds from domestic resources. The state must have the savings to finance development, and these public savings have to increase from time to time.

He noted that public savings held by Indonesian banks stood at Rp 183 trillion (US$80.9 billion) as of last June, as compared to Rp 522 billion as of 1971.

To boost public savings, Soeharto called on teachers and parents to promote saving money among children so that it will become an inherent part of the nations' culture.

Soeharto assured that the government would continue to develop a healthy and strong banking system and keep inflation low. Besides that, the government will continue its prudent macro- economic policies to maintain a stable economy and to encourage domestic savings. (rid)