U.S. Treasury confirms to send envoy to Indonesia
U.S. Treasury confirms to send envoy to Indonesia
WASHINGTON (Reuters): The U.S. Treasury confirmed on Friday it plans to send an envoy to Indonesia, but refused to be drawn on chances of persuading Jakarta to adopt reforms agreed with the International Monetary Fund.
"Obviously the ultimate result that we hope for -- we are not predicting anything -- is an agreement between Indonesia and the IMF on a strong reform program that address problems and creates confidence," Treasury Secretary Robert Rubin told reporters after a meeting with Thai Prime Minister Chuan Leekpai.
Rubin, who has repeatedly called on Indonesia to adhere to an IMF-backed program of economic reform, said Treasury Undersecretary for International Affairs David Lipton would visit Jakarta for what he described as technical discussions. He did not give a date for the trip.
"We are not going with a plan," Rubin said, responding to a question on whether debt relief would be on Lipton's agenda.
"We are going with an extremely efficient individual, somebody who has been involved with these kinds of problems around the world, who will be meeting with Indonesian officials to discuss the problems," he added.
Officials from the IMF and from rich industrialized countries have become increasingly frustrated at the so-called "crony capitalism" which has enriched family and friends of President Soeharto and at Soeharto's refusal firmly to abandon controversial currency plans.
Soeharto is toying with the idea of introducing a rigid currency board, which would peg the rupiah to the dollar and tie cash in circulation to central bank reserves.
The IMF says the idea is not appropriate at present because Indonesia has limited reserves, a vulnerable banking system and huge corporate debts.
An IMF team is due in Indonesia soon, but officials in Washington said it would be a staff team rather than a top-level management one.
The IMF's two most senior officials -- Michel Camdessus and First Deputy Managing Director Stanley Fischer -- both visited Indonesia in January to persuade Soeharto to follow a strengthened reform package.
Three separate U.S. teams have also visited Jakarta since mid- January. The last delegation was led by former Vice President Walter Mondale, sent to Jakarta as a special envoy by U.S. President Bill Clinton.
Rubin said on Friday reform held the key to Indonesia's economic success.
"In Indonesia the key is for the government to put in place the kind of reforms that will both deal with the problems that arise and create confidence," he said. "We are doing everything that we can to try to contribute to that process."