WB, IMF urged to focus on good governance
WB, IMF urged to focus on good governance
JAKARTA (JP): Minister of Finance Bambang Subianto urged the
World Bank and the International Monetary Fund in Washington on
Thursday to shift their work focus to developing "good
governance" in government and social institutions in the wake of
the latest economic developments.
Speaking on the second day of the seventh annual World
Economic Development Congress in Washington, he said that it had
become increasingly clear that an important aspect of development
was what many often referred to as good governance.
"Good governance is often assumed to be synonymous with
reductions in corruption. Reducing corruption is important but
good governance means much more," he said.
He explained that good governance involved creating
institutions to deal effectively with the myriad economic and
social decisions required for the management of a modern economic
state.
"If economic growth is to be sustainable and stable it is as
important that we strengthen the social and economic institutions
that make up our society as it is to raise the level of capital
formation," he said.
He said that while the World Bank's role as the mobilizing
agent for capital had been reduced, a more important function
loomed, which was "to identify the needed changes in governance
and how institutions can successfully manage the changes."
Bambang also said that international financial support should
go beyond physical and tangible infrastructure projects.
"The development of well functioning nonphysical or intangible
economic infrastructures at least should include a system to
provide for disclosure of financial corporation, and a system to
allow for the maintenance and improvement of a competitive
environment and achievement of competitive price levels.
"We can easily observe that in many emerging economies such
infrastructures have not been functioning or even do not exist.
IMF and the Bank's focus on the development of intangible
economic infrastructure is certainly necessary."
Bambang is scheduled to meet key officials of the World Bank,
IMF, Asian Development Bank, and senior people from several
foreign financial institutions.
He is then to attend the upcoming annual congress of the
Institute of International Finance. (rei)