U.S. senator upbeat about RI economy
U.S. senator upbeat about RI economy
JAKARTA (JP): United States Senator Max Baucus said here
yesterday he was optimistic that Indonesia would be able to
weather the currency crisis if it fully implemented its reform
package.
Baucus said the currency crisis, which has led to the fall in
the rupiah's value against the U.S. dollar by over 50 percent
since early July, was mainly caused by a rumor-aggravated market.
"Much of what's going on now is psychological," Baucus told
journalists at the start of his three-day visit to the country.
Concern over the financial crisis in other countries such as
South Korea also affected public confidence in the Indonesian
economy, he said.
Baucus, a Democrat from the state of Montana, said the
condition could only improve if Indonesia soon implemented the
economic reforms agreed to with the International Monetary Fund
(IMF).
The Indonesian government recently issued economic reforms
consisting of massive cutbacks in the state budget and state-
related projects, the consolidation of the financial sector and
the abolishment of monopolies of certain important commodities to
support the US$23 billion IMF bailout program.
The sooner Indonesia committed to the reforms, including the
restructuring of its finance institutions, the sooner investors
would return to the country, he said.
Baucus said the United States would back Indonesia to do what
was necessary to help restore confidence in the country.
"I am here also to reconfirm the U.S. commitment to the
region, particularly to Indonesia," he said, adding that the U.S.
would continue helping Indonesia through independent institutions
such as the IMF.
Baucus, who is leading a trade delegation comprising of 12
businessmen from Montana, said the United States still saw
Indonesia and other countries in Southeast Asia as prospective
business partners despite the crisis.
"We are more interested in the Asia-Pacific region than in
Europe," he said.
Indonesian ambassador to the United States, Arifin Siregar,
said yesterday Indonesia remained one of the 10 preferred trade
partners of the U.S. government.
"Indonesia is considered by the U.S. trade ministry as one of
the best countries for trade," Siregar told a luncheon, hosted by
the Indonesian Chamber of Commerce and Industry (Kadin) for
Baucus and the Montana trade delegation.
The U.S. market was a target for exporters, since America's
economy was sustaining high growth, low inflation and a higher
purchasing power, he said.
He said the depreciation of the rupiah had also made
Indonesian exports more competitive in the U.S. market.
Siregar said many U.S. investors were interested in investing
in infrastructure, power plants, telecommunications and
transportation in Indonesia.
Tony Agus Ardie, Chairman of the committee, conceded Indonesia
had to work harder to regain the confidence of foreign investors,
notably those from the U.S.
"American investor interests in Indonesia have been declining
since the outbreak of our financial crisis," Tony admitted.
Baucus said Montana, a northwest state with a population of
900,000, was interested in cooperating with Indonesia in
environmental technology, and the livestock, wood products and
energy industries.
Montana was specifically interested in entering the country's
environmental technology sector, such as water and waste
management, as the sector had yet to be developed in Indonesia,
he said.
"Dollars invested in environmental technology is not an
expenditure, it's an investment. It helps raise the quality of
life and eventually the country's economy," he said.
Baucus and the trade delegation arrived here Tuesday after his
visit to Japan, the Philippines and Brunei. He is scheduled to
leave for Bangkok today. (das)