War on corruption doubted

War on corruption doubted

JAKARTA (JP): The World Bank and International Monetary Fund's
(IMF) anticorruption pledge received a cool response from
observers here over the weekend.

Well-known economist Kwik Kian Gie said in Indonesia's case
the declaration was lip service rather than a concerted effort to
put pressure on the government to eradicate corruption.

"It (the declaration) will become a laughing stock among elite
political and business groups here," Kwik said. "They know the
World Bank can do nothing because it has too many interests at
stake in the country."

He said the campaign would have little impact because it
failed to specify the targeted countries.

Both the IMF and World Bank announced, during a meeting in
Hong Kong on Friday, they were escalating the worldwide war on
corruption.

World Bank President James D. Wolfensohn warned that
corruption would be directly taken into account in lending
decisions.

The two multilateral fund lending groups hold more than US$300
billion in lending assets.

Indonesia is one of the World Bank's largest borrowers and the
bank is the nation's second largest donor after Japan. The World
Bank committed itself to giving $1.5 billion to the Consultative
Group on Indonesia (CGI) during its annual meeting in Tokyo last
July.

Kwik said the World Bank would not apply tough measures to
Indonesia because it risked losing its lending assets.

"What can they (IMF and the World Bank) do with Indonesia,
which is called one of the world's most corrupt countries?"

In April, a Hong Kong-based Political and Economic Risk
Consultancy (PERC) survey placed Indonesia on the top of a list
of Asia's most corrupt countries.

An American professor of political economy, Jeffrey A.
Winters, said in July that about one third of the World Bank's
loans to Indonesia since 1965 had been leaked and were
"unaccounted for".

But the World Bank's Vice President for East Asia and the
Pacific, Jean-Michel Severino, said Winters' accusations were
"demonstrably untrue". Minister of National Development Planning
Ginandjar Kartasasmita dismissed the allegations as "groundless".

Separately, Faisal Basri from the University of Indonesia said
the anticorruption declaration may have been triggered by a
collective awareness.

He said the campaign could be accelerated by urges from
American businessmen who feel that corruption hinders fair
competition in business.

"Corruption has become a global phenomenon and an
international code of conduct to cope with it is needed."

Yesterday, House of Representatives legislator Theo Sambuaga
joined the debate, asking both the IMF and World Bank not to
apply their own standards on corruption or dictate anticorruption
measures to a country.

"Indonesia has long enacted and implemented strict
anticorruption measures. So the IMF and the World Bank's
declaration is not relevant here," Theo, from Commission I for
political and foreign affairs, said.

The Indonesian government would consistently allow no room for
graft, without having to wait for an outsider's demand or
pressure, he said.

Rather than launching a late anticorruption campaign, the two
international organizations should set up mechanisms to prevent
currency crisis in the future, he said. (10/amd)