INFID


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Title 

Short News Overview.

No

81

Period

1 March 2002 – 7 March 2002

INFID News

New statement and press release by NGO Coalition for a New Constitution (Bahasa only):

Press release: http://infid.ngonet.be/konferensipers.html

Critical review and recommendation on the process of the 1945 Constitution amendment: http://infid.ngonet.be/tinjauanamandemen.html

INFID Related Issues

Debt

Indonesia said it was optimistic it would secure more debt rescheduling from the Paris Club of official creditors in a meeting in April. Earlier last month the government said it would seek to reschedule both principal and interest on some of its official foreign debts maturing between April 2002 and December 2003 from the Paris Club. If successful, the next round of Paris Club talks would lead to Indonesia's third debt restructuring since the crisis. But this move would risk Indonesia's long-term sovereign debt rating being downgraded by Standard & Poor's to "selective default," if the Paris Club insists on equal treatment for private lenders. A downgrade to selective default would make it more difficult for the country to attract foreign capital and would likely force up the cost of borrowing, though analysts in Indonesia have brushed off such concerns. They said even without the downgrade the country was already at the stage where hardly any foreign institutions would extend new lending as Indonesia was still struggling to restructure its existing hefty debts. Standard & Poor's already cut the country's long-term sovereign debt rating to CCC from CCC-Plus in early November, citing concerns the Paris Club creditors would insist private bondholders of Indonesia's official debts share the burden of debt restructuring in terms of both principal and interest payments. Minister of Finance Boediono said he would go on a two-week trip in the second week of this month to lobby several member countries of the Paris Club.

Meanwhile, the International Monetary Fund (IMF) has informed Jakarta that progress has to be shown on a number of key issues before it will approve the next disbursement under a US$5 billion economic package. The Fund will only disburse the next trench of US$450 million after receiving approval from its board. But the approval now hangs in the balance given that the government has made slow progress on the six items, such as a credible plan for recovering the loans owed to the government by former bank owners; a clear tax policy to improve tax collection; conducting a rights issue for Bank Internasional Indonesia (BII); and exchanging the fixed rate bonds for floating rate bonds in Bank Niaga. The government hopes to sell this bank in the near future. The other two items - the completion of a credible process to sell Bank Central Asia (BCA) and submission of a report on a new law for Bank Indonesia to parliament - are close to completion. The government is currently discussing the new law with legislators and is in the final stages of completing the BCA sale. By far, the most contentious issue is the plan to grant former bankers an extension period of six years to repay their huge loans.

The Cabinet has been deeply split on the issue with Mr Dorodjatun, Minister for State Enterprises Laksamana Sukardi and the Indonesian Bank Restructuring Agency (IBRA) in favour of granting the extension while State Minister for National Development Planning Kwik Kian Gie question the viability of the plan as many of the debtors have not shown any intention of repaying their loans. The government rejected the controversial plan on March 7.

Source: Reuters 01/03, BT 01/03

 

Human Rights

TNI/Polri

The Indonesian military (TNI) will write a letter to the House of Representatives (DPR), asking them to summon the National Commission for Human Rights (Komnas HAM) and the Commission for Inquiry to Human Rights Violations (KPP HAM) to explain their works on the Trisakti/Semanggi I-II incidents, a high ranking TNI official says. Chairperson of Law Development Body (Kababinkum) Maj. Gen. Timor Manurung said on March 6 that the works of KPP HAM had violated the law and molested the TNI institution, adding that TNI would not answer to the summonses of KPP HAM. Later on the same day, the National Police also showed its defiance. Ins. Gen. Logan Siagian, the Polri’s Kababinkum, sent a letter to Chairperson of KPP HAM, Alber Hasibuan, rejecting the summons. Former National Police Chief Gen. (ret) Roesmanhadi and former Armed Forces Chief Gen. (ret) Wiranto are also maintaining their resistance to the summonses. While Wiranto was unresponsive, Roesmanhadi, through his lawyers, gave a prior notice to KPP HAM probing the incidents that he would not bow to the summons because he did not recognise the existence of the inquiry. He also insists the inquiry to be disbanded. The Central Jakarta District Court has ruled that the inquiry is legitimate and has the right to summon security officers involved in the bloody incidents. KPP HAM has issued new summonses at the request of the court. The first summons sent to the two retired generals was dated Feb. 26.

Sources: KCM 06/03, JP 06/03

General News

"Alternative" Approach to Debt

The Indonesian Government is reviewing its membership of 185 international organisations and is likely to leave more than 40 of them to save money. A report said Indonesia’s membership of the 185 international organisations costs at least US$17.38 million a year. No figure was given for the possible cost saving of withdrawing.

But other figures are available (for comparison):

Total foreign debt: US$143,5 billion

Private banks debt to government: US$13 billion

Buloggate II that involves the House Speaker as a suspect: US$5.4 million

Military expenditure: US$1 billion

Sources: AFP 05/03, BI 05/03, AT 28/02, JP 06/03, CW 07/03

Regional News

Aceh

Authorities in Indonesia's restive province of Aceh said they will start enforcing an Islamic dress code in towns and cities this month. Provincial secretary Thantawi Ishak said the regulations would be introduced on March 15.

"In the first phase, proper Muslim attire for women will be required in all urban areas in Aceh," he said. Islam requires women to cover everything except their face, hands and feet. Muslim men must cover their midriff and wear shorts which cover their knees. Ishak said police would conduct street checks but initially violators would just be warned and excluded from urban areas. Future sanctions would be decided in talks between the sharia office, the Muslim Scholars' Council and local police.

The Indonesian government in 1999 authorised provincial authorities to implement partial Sharia law. Last year parliament also passed a law which grants the province greater autonomy and a much larger share of oil and gas revenues. Ishak also said all government and private offices must install business signs in Arabic-style script. Sharia law is not in force anywhere else in the archipelago.

The Free Aceh Movement (GAM) in its statement called the plan as a "hypocrisy". "Here we have an avowed secular anti-Islam force that has been responsible for the death, rapes and brutalization of thousands of women in Aceh for years, now wanting to be their guardiance of morality", the statement says. " … , although we agree that women and men dress modestly, we don't consider it is a matter for the State to dictate." GAM condemned the plan as another government desperate act to create discords among the population, referring to the recent Laskar Jihad’s intention to deploy its member in Aceh. "This is to show the world as though the Acehnese were such fanatic Muslims that Jakarta has to appease", the statement concludes.

Sources: AFP 4/03, IS

Maluku

Four people were injured on March 3 in clashes that marred a joint Muslim-Christian peace rally in Ambon City. A group of unidentified people armed with machetes attacked Muslim and Christian residents parading in the city's Wai Hong district to celebrate a peace accord signed last month.

On Feb. 27 Muslims and Christians mingled freely for the first time in years in Ambon. Witnesses said people from the two faiths hugged each other or shook hands. Christian and Muslim leaders on February 12 signed an agreement to end the sectarian bloodshed. The violence began in Ambon in January 1999 with a minor neighbourhood quarrel and quickly spread to other islands in the Malukus, leaving some 5,000 people dead and half a million homeless. The two sides vowed to halt all conflict and agreed to disarm. Police have set a deadline of March 1 for people including soldiers or police to surrender illegal weapons.

Source: AFP 03/02

Abbreviations

AFP Agence France Prese
AT Asia Times
BT Business Times (Singpore)
CW CIA World Fact Book 2001
IS INFID Sources
JP The Jakarta Post
KCM Kompas Cyber Media

 

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