What we need is leadership -- FOR MONDAY'S EDITION

What we need is leadership -- FOR MONDAY'S EDITION

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Sayidiman Suryohadiprojo
Former governor of
National Resilience
Institute (Lemhanas)
Jakarta
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State Minister of National Development Planning Kwik Kian Gie
has surprised many people when he strongly suggested that
Indonesia should terminate its relationship with the
International Monetary Fund (IMF) at the end of 2002.

In fact, this is not the first time that Kwik has expressed
his dissatisfaction with the IMF. But that he did it as a member
of President Megawati Soekarnoputri's Cabinet, is something that
causes surprise. Because it is public knowledge that Dorodjatun
Kuntjoro-Jakti, the current coordinating minister for economic
affairs, is a staunch defender of Indonesia's relations with the
IMF.

In Indonesia Kwik is not alone in his negative opinion of the
IMF. Rizal Ramli, who served as coordinating minister for
economic affairs and minister of finance in former president
Abdurrahman Wahid's cabinet, shares this view. And so are other
economists, many of them with important positions in Indonesian
public life. But on the other side Dorodjatun also has friends
who share his views. Some of them are equally strong in their
belief and even dare to say that Indonesia will go bankrupt
without the IMF's support.

The debate that developed between the economists with
conflicting views heated up and might be very interesting for the
intellectual elite. But it does not ease the difficult life of
the common people and their heavy economic burden. And a debate
between ministers of the same Cabinet about such an important
issue is definitely counter-productive for Megawati's leadership
of the nation.

It is a fact that many economists in the world have expressed
a strong criticism of the way the IMF is playing its role in
supporting developing nations. Not long ago Dr. Joseph E.
Stiglitz, Nobel Prize laureate for economy in 2001, and former
economic adviser to then president Bill Clinton and former chief
economist of the World Bank, had stated that the IMF's stance on
market fundamentalism is principally false. Namely, that the
market of itself will create a balance between supply and demand
and is a key for growth and development. IMF's prescription to
the nations it is supposed to support has caused much more human
suffering than solving those nations' economic problems.

Stiglitz also stated that the IMF and the U.S. Treasury
Department were more inclined to aim their efforts at defending
the interests of big investment bankers than paying attention to
poor and developing nations.

With the credentials of Stiglitz as an economist and his
experience with the World Bank and the U.S. government, we must
assume that what he stated publicly contains the truth. And
Stiglitz is not the only economist of international fame that
criticizes the IMF and its behavior.

Looking from this point Kwik and his partners are on the right
side. However, Dorodjatun and his friends are equally convinced
of Indonesia's uncertain future when it drops the IMF.

Malaysia has shown that it could solve its economic crisis
problems without IMF support. Already at the start of the crisis
in 1997 Malaysia decided not to request support. And Malaysia is
now in a good and safe economic position. That is proof that a
developing nation facing economic crisis need not have the IMF's
support. We can therefore say that Dorodjatun's pessimism might
be an exaggeration. After Malaysia, Thailand and South Korea also
opted to dropping IMF support. The conclusion is that it might
not be impossible for Indonesia to do the same. That makes Kwik
the man with the right intention for Indonesia.

If that is true, why was Kwik unable to steer the Indonesian
economy in safe waters when he was the economic coordinating
minister. The same goes for Rizal Ramli. Both of them as the boss
or commanding generals of Indonesia's economic struggle were in
the position to free Indonesia from IMF support and take the
country out of its present economic troubles. But they were not
able to deliver any progress in the bad situation.

Without being an economic expert one can observe that nothing
has fundamentally changed during their time as Indonesia's
economic czars. It is therefore questionable whether that with
their track records they would be able to steer Indonesia out of
the crisis without IMP support.

It is very sad for an Indonesian patriot to realize that today
the other Asian nations have already left the crisis that started
in 1997, but Indonesia alone is still fighting to get out. Of
course, any thinking Indonesian would very much welcome
Indonesia's self reliance and not longer has to depend on the
IMP, World Bank or any other international financial institute.
Indonesians envy Malaysia that has been successful in its
economic struggle, whereas Indonesia basically has similar
capabilities. Moreover, Indonesia is gifted with a lot of
valuable natural resources, in particular oil and gas.

But Malaysia was able to achieve success because it has the
right leadership in the person of Prime Minister Mahathir
Mohamad. It is doubtful whether without his leadership success
could have been achieved.

We also see China's economic progress because of the
leadership of Deng Xiaoping, who started economic reform in a
very fundamental way in 1979. Later he was replaced by Jiang
Zemin and Zhu Rongji who were all very strong in leading China
toward progress. Without that strong leadership China would not
be in the position it is today.

Also Germany after World War II was able to demonstrate a
Wirtschaftswunder or economic miracle because of the leadership
of Konrad Adenauer supported and later replaced by Ludwig Erhard.
It is quite interesting that among the names just mentioned only
Ludwig Erhard is an economist. Mahathir is a medical doctor
turned politician, Deng Xiaoping a People's Liberation Army (PLA)
general with the engineers Jiang Zemin and Zhu Rongji, and Konrad
Adenauer the lawyer. It is not the basic background that is
important, but the capability to demonstrate leadership in
difficult times.

It is clear that the problem for Indonesia is not the question
of dropping or maintaining IMF support. But the capability of our
elite to demonstrate the right leadership. Do we have people who
have a strong enough ambition to create a strong national
economy? Are there people who strongly want to alleviate the
people from poverty, provide food and homes, education and health
services attainable for every one in this nation? And are they
also ready to perform the leadership and management to achieve
these goals by motivating the people and taking them along for a
struggle to produce results.

What we need is the leadership that can set the example and
get the people's trust. In Indonesia we say Jer Basuki Mawa Bea,
if you want to be successful you must be prepared to suffer
first. Not leadership that only can talk without doing anything
important. Let us suggest to our economists that theorizing and
debating is definitely very good and important for the economic
science. But realities require action that produce results and
improvement.