Soeharto seeks debt reductions

Soeharto seeks debt reductions

JAKARTA (JP): President Soeharto called on urged multilateral
creditors yesterday to slash the debt obligations of the world's
poorest countries and to play a greater role in stabilizing
financial markets.

Speaking at the World Economic Forum on East Asia in
Singapore, Soeharto said bilateral and commercial creditors have
assisted these countries with bilateral and commercial debt
reductions.

"However, multilateral financial institutions have never been
willing even to discuss the possibility of debt reduction,"
Soeharto said.

He added that the Non-Aligned Movement, currently chaired by
Indonesia, believes that, while each debtor should "put its own
house in order," the international community should create the
necessary external environment through, among others things, the
reduction of bilateral, commercial and multilateral debts.

The movement is trying to convince multilateral lending
institutions that the obligations of the poorest countries to the
institutions are just the same as their obligations to bilateral
and commercial creditors, he said.

"I am happy that the World Bank is for the first time willing
to discuss a facility to help the world's poorest countries with
multilateral debt reduction," Soeharto said.

He called upon the World Bank and the International Monetary
Fund to play a larger role in encouraging more stable exchange
rates and movements of capital that will not be destructive of
world financial markets.

Soeharto, who hosted last year's annual summit meeting of the
18-member Asia-Pacific Economic Cooperation (APEC) forum, gave
assurances that Asia's regional groupings are not aimed at
creating exclusionary trade or economic blocs.

"It is of utmost importance for this audience to realize that
our goal in building regional arrangements is not to create any
kind of exclusionary trade or economic bloc," Soeharto told the
meeting.

Soeharto strongly endorsed the World Trade Organization (WTO),
saying: "We fully support the role of the WTO and will contribute
to its continuing efforts to build a global system of free
trade."

He urged regional trade groupings to remain open to non-
members and contribute to a global trading system. Some of Asia's
most important economic partners are outside groups such as the
APEC forum or the ASEAN Free Trade Area, he added.

ASEAN (the Association of Southeast Asian Nations) groups
Indonesia, Singapore, Brunei, Thailand, Malaysia, the Philippines
and Vietnam, while APEC groups Australia, Canada, Chile, China,
Hong Kong, Japan, Mexico, New Zealand, Papua New Guinea, South
Korea, Taiwan, the United States and all ASEAN members except
Vietnam.

Soeharto expressed concern about trade disputes among APEC
members, saying that unresolved conflicts could harm the systems
that have been so carefully built to promote freer world trade
and investment.

"To avoid it, APEC is trying to find approaches to resolve the
disputes so as to complement official provisions of the WTO,"
Soeharto said.

Later yesterday, in opening of the Singapore-Indonesia joint
exhibition in Singapore, Soeharto said that ASEAN's strategic
position would ensure that it received the greatest benefits from
the achievement of free trade and investment in the region.

Meeting

During his nine-hour stay in Singapore, Soeharto met with
Singaporean Prime Minister Goh Chok Tong and Senior Minister Lee
Kuan Yeuw and made an honorary visit to President Ong Cheng
Teong.

During a one-hour meeting at Singapore's presidential palace,
Soeharto and Goh agreed to forge closer bilateral ties through
the improvement of economic activities.

"The agreements (between the two leaders) are to continue the
tourism development on Bintan island in Riau and in Manado in
North Sulawesi, the development of the Yogyakarta-Surakarta toll
road in Central Java and other economic activities,"
Minister/State Secretary Moerdiono told journalists after the
meeting.

Soeharto, who was accompanied by First Lady Mrs. Tien
Soeharto, also witnessed the signing, by transportation and
defense ministers, of a memorandum of understanding on civil and
military aviation cooperation between Indonesia and Singapore.

Under the memorandum of understanding, Indonesia will allow
Singaporean air force planes to fly south up to 50 kilometers
into Indonesia's air space. The memorandum also assigns
Singapore's Changi airport to manage air traffic around the Hang
Nadim airport on Batam island, Riau.

"With the integration of the two airports, Indonesia and
Singapore agreed to abide by the principal of 'first come first
served'," Indonesian Minister of Transportation Haryanto
Dhanutirto said. (rid)

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