S'pore urged to help Indonesian economy
S'pore urged to help Indonesian economy
SINGAPORE (AFP): An outspoken Indonesian economist on Thursday
urged Singapore to step up assistance in reviving lending to
businesses in Indonesia, saying some of the capital which has
fled to the city-state should flow back.
Despite "unofficial" initial meetings between Singapore and
Indonesian representatives seeking to aid Indonesia's recovery,
"Singapore seems reluctant to help," said Sjahrir, chairman of
the Institute of Economic Studies Research and Development in
Jakarta.
"Singapore is becoming the most important place for the
capital market. Singapore can assist in developing Indonesia's
banking systems," Sjahrir told businessmen at a forum here on
Indonesia's political and economic future.
"Lending is the most important and Singapore is important to
this," he said.
"The state of Indonesian banking is that the entire Indonesian
banking system is insolvent. The question is whether banks can
start lending, the answer is very unlikely," he said.
The Indonesian Bank Restructuring Agency (IBRA), an autonomous
body tasked with rehabilitating Indonesia's insolvent banking
system, "will have a part in recapturing the money" that has left
Indonesia, he said, adding that "some of this (money) is in
Singapore."
"Indonesia has every right to know what happened to the
money ... There is money accessible that can be returned to
Indonesia to address the insolvency problem," said Sjahrir, who
is also chairman of a capital market securities company that
bears his name.
He warned that unless Indonesian businesses could have access
to capital to resuscitate their businesses, poverty would worsen
and lead to more unrest.
"Southeast Asia, ASEAN, will not be successful with an
anarchic Indonesia," he said, referring to the nine-member
Association of Southeast Asian Nations.
But his call was rebutted by Tommy Koh, Singapore's
Ambassador-at-Large.
"Singapore wishes to help Indonesia recover but we can only do
that if you help yourselves," Koh said at the forum.