WB urges end to W. Timor violence

WB urges end to W. Timor violence

JAKARTA (JP): World Bank President James Wolfensohn urged
Indonesian President Abdurrahman Wahid in a letter last week to
halt violence in West Timor but he said nothing about any plans
to cut further aid, the bank's country director here Mark Baird
said on Tuesday.

Baird said in a statement that Wolfensohn did warn in a Sept.8
letter to Abdurrahman that events in West Timor would have a
negative impact on international sentiment towards Indonesia,
affecting donor support and investor confidence.

"But contrary to some reports, the World Bank has no plans to
cut assistance or delay the Consultative Group on Indonesia
creditor meeting (scheduled in Tokyo for next month)," Baird
asserted.

The Washington Post was quoted by Reuters on Tuesday as
reporting, based on Wolfensohn's letter to Abdurrahman, that the
World Bank chief warned the Indonesian President to take concrete
steps to end violence in West Timor or risk financial assistance.

"I would ask you to do your utmost to stop the violence before
any more innocent lives are lost," the Post quoted Wolfensohn as
saying in the letter delivered to Abdurrahman in New York on
Friday, just days after three United Nations relief workers were
killed by a militia-led mob in western Timor.

The Post described Wolfensohn's letter to Wahid as being
unusually political in nature for the World Bank, which has
provided billions of dollars in loans to Indonesia and generally
focuses on economic policies.

Baird said the World Bank had no plans to revise its support
to Indonesia.

"What the letter clearly indicates is that the international
community will be looking for early and concrete action to
address the situation in West Timor," Baird said.

Baird said Wolfensohn's letter made three key points: the
violence must be brought under control; the U.N. must be allowed
to resume humanitarian activities; and refugees who wish to
return to East Timor should be able to do so.

The 20 countries and agencies that are the biggest donors to
the bank's Indonesian programs are due to meet in mid-October.

"I look forward to being able to report to donors at next
month's Consultative Group meeting that the violence has ended,
that the United Nations has been able to resume its humanitarian
activities and that those who want to return home to East Timor
are now being allowed to do so in safety," Wolfensohn wrote,
according to the Post.

Reminding Wahid that Indonesia still needs financial support
and investor confidence, the bank president pointedly added that
"this is ... an issue watched closely by the international
community."

The United Nations Security Council will send a mission to
Indonesia next week to investigate the resurgence of military
strikes against U.N. relief workers and Timorese civilians
trapped in refugee camps.

The militias, originally organized by the Indonesia army, went
on the rampage in East Timor a year ago after the people there
voted overwhelmingly for independence from Jakarta. The militia
were quelled by Australian-led troops and fled over the border to
Indonesian West Timor, herding hundreds of thousands of Timorese
with them into refugee camps.

The World Bank has $5.5 billion in outstanding commitments to
Indonesia, of which $2.8 billion has not been disbursed. That
includes money for 64 specific projects as well as structural
adjustment programs that help support the budget and fund social
programs.

In fiscal 2000, the World Bank committed itself to an
additional $2.74 billion in future loans. Because higher oil
prices have boosted Indonesia's revenue, new commitments in
fiscal 2001 are expected to be much lower.

When violence broke out in the former Indonesian region of
East Timor, now an independent nation, Wolfensohn warned
Abdurrahman's predecessor, B.J. Habibie, that he risked losing
international financial support if he did not order the
Indonesian military to stop the bloodshed.

U.S. Defence Secretary William Cohen is traveling to Jakarta
next week to convey a similar message.

The deaths last week of the three U.N. workers "raise more
questions about why the violence is allowed to continue," the
Post quoted Wolfensohn as writing.

Wolfensohn added that despite Abdurrahman's previous
assurances, "the situation grows more dangerous and urgent by the
day," the Post reported, as quoted by Reuters.