Supervision of donors' aid

Supervision of donors' aid

In noting that various donor countries are to make grants and
loans to Indonesia (The Jakarta Post, Feb. 3, 2000: Donors pledge
$4.7 billion in loans), I see that the meeting of the donors was
chaired by the World Bank. I also see that if the International
Monetary Fund (IMF) agrees to the new Letter of Intent submitted
by the government, they will begin to release US$5 billion in
bail-out money.

Not so long ago, the World Bank and the IMF were adamant that
they would not lend any money to Indonesia unless the Bank Bali
report was published in full, which has been done, and they could
see proof that all of the beneficiaries of the stolen money would
be prosecuted, which does not seem to be happening. What has
happened in the meantime to persuade the World Bank and these
donors that there have been any changes in the normal way of
distributing aid money in Indonesia? It is known, even admitted
by Indonesian authorities, that money disbursed by the central
government either does not reach the intended beneficiaries, or
only part of it is properly distributed.

In what ways will the donors and the World Bank ensure that
this new money will be distributed properly and not end up in the
personal bank accounts of various government officials,
governors, regents, etc., as has been admitted was the case in
the past? Have the donors been promised absolute control, even
down to the actual handing out of the money to the intended
beneficiaries? Or will they be able to put their own people in to
supervise the completion of projects? Or will they pay out only
on inspection of the completion of the different stages of the
projects? Will they be able to approve the choice of contractors,
and will these contractors be ones who have submitted bids in a
completely open and competitive tender?

Without some or all of these safeguards it will be the same
old excuse by the central government that they are incapable of
controlling what the provinces do, and about 30 percent of the
money will disappear. This percentage is based on statistics as
confirmed by Susan Rose-Ackerman in her latest book, Corruption
and Government. Rose-Ackerman is a professor of law at Yale
University and has specialized in the study of corruption for the
past 25 years. Her conclusions and recommendations deserve
careful study by all those who have the true interests of
Indonesia at heart.

W. WALLER

Cianjur, West Java