The World Bank toughens its stance

The World Bank's attitude towards Indonesia has changed. In the past, the bank always avoided censuring president Soeharto even though it admitted corruption, repression and the collapse of the financial system progressively grew in Indonesia during his 32-year rule. In a report released in February, the bank admitted that opposing the Indonesian government's policies at that time would have meant destroying the bank's image as a staunch supporter which helped make Indonesia's success story.

The World Bank has now shed its former timidity and is limiting its assistance to Indonesia even though this country has once again become poor, its per capita income having fallen from US$1,184 a year in 1996 to $300 at present. It may approve an Indonesian request for aid under the International Development Assistance (IDA) program, but only if that aid will be used for certain (World Bank approved) purposes such as building a social safety net.

Why this change of attitude on the World Bank's part? There are two possible factors: First, it may regard Indonesia as still being still well-off enough (to help itself). Second, the bank feels it will have to be more careful in dealing with Indonesia because the money might simply disappear.

Indonesia is quite well known internationally where practices of corruption and collusion are concerned. Even money for the country's social safety net is being corrupted, and this is done not only by bureaucrats, but also by members of certain non- governmental organizations.

So great is our dependence on foreign loans at present, though, that those who are in charge of handling the money should not be irresponsible. Such an objectionable attitude on the part of just a few could easily harm the interests of the community as a whole. In this era of reform there is no place for dishonesty, much less for behavior that hurts the most basic interests of our poor.

-- Bisnis Indonesia, Jakarta