State guidelines aim for fair market

State guidelines aim for fair market

JAKARTA (JP): The People's Consultative Assembly (MPR)
proposed on Thursday state policy guidelines which are aimed at
creating a market economy, giving no room to monopolistic and
corrupt market structures developed during the past 32 years of
former president Soeharto's rule.

In its 28-point directive, the draft of the guidelines, which
was submitted to the Assembly Working Committee for further
deliberation, asserted an economic system which is based on
healthy and fair competition.

"The guidelines will work to prevent a monopolistic market
structure and various distorted market structures which are
detrimental to the people," the draft reads.

The MPR expects to finalize and approve the state policy
guidelines before it selects the next president on Oct. 20.

In its introduction, the draft guidelines say that the past
corrupt economy has led the country into a devastating crisis.

Critics have said that past economic development programs
benefited only a handful of the country's conglomerates and the
family of Soeharto. An investigation into corruption which
involved Soeharto's charities was terminated on Monday.

The state guidelines say that the new government must avoid
multiple interpretation of rulings and policies and be efficient
and transparent in the use of foreign loans.

"The (future) borrowing of foreign loans must be approved by
the House of Representatives (DPR) and regulated by law," it
says.

The state guidelines also rule that foreign loans must be
reduced gradually in a bid to gain a healthy state budget with a
low deficit.

"This can be achieved by gradually lessening subsidies,
increasing taxes in a fair way and by using budget saving
measures," the draft says.

Non-governmental organizations have alleged that the Soeharto
government corrupted some 30 percent of the country's foreign
loans. They demand that the World Bank and other donors provide
debt relief of up to 30 percent on grounds that the donors were
aware of the leakage but failed to stop it.

The country currently has some US$70 billion in sovereign
overseas loans.

Another directive recommends that the new government
"renegotiate and accelerate the restructuring of overseas loans
with the IMF, World Bank and other donor institutions by
considering the ability of the state". The process must be
implemented in a transparent way and through consultation with
the DPR.

The state guidelines also list priorities for the new
government to immediately lift the country out of the protracted
economic crisis, through, among other things, price and currency
stabilization and the acceleration of bank and corporate
restructuring.

The state guidelines also highlight the importance of
improving the lives of the poor, particularly those badly hit by
the economic crisis.

"Various integrated efforts to accelerate the poverty
eradication program and to reduce unemployment are imperative,"
the draft reads.

It also stresses the need to increase the role of small scale
businesses and cooperatives, to protect them from unfair
practices and to create a conducive business environment.

The state guidelines also say that the welfare of civil
servants and the military must be increased to curb corruption in
the bureaucracy.

The state guidelines also mark the importance of a wide-
ranging autonomy for provinces, subdistricts and villages in a
bid to accelerate regional economic development. (rei)