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INFID News Paris Conference INFID together with 13 other NGOs
from five different countries organised an international conference on
"Alternative Solutions for Indonesia’s External Debt" in Paris,
April 8, 2002. The conference that took place in the Assemblée Nationale was
opened by former prime minister of France Michel Rocard. Michel Rochard, who
is now the chair of the Commission on Culture, Youth and Communication of the
European Parliament, in his opening address suggested that Indonesia should
raise the issue of debt repayment in local currency and export quota
exemption in the forthcoming Paris Club meeting. According to Rocard,
Indonesia could have a debt relief, but it would take years and years of
negotiations. The most realistic target at present is to ask for debt
repayment in local currency or additional export quota – even free export –
to the creditor countries. Also present as a speaker in the
conference, moderated by INFID Executive Secretary Binny Buchory, was Nancy
Birdsall, President and Co-Founder of Center for Global Development,
Washington DC. Birdsall compared Indonesia to a very sick patient that was
actually badly in need of a surgery, but has received increased doze of
aspirines instead. Noted activist HS Dillon also stressed the need of proper
treatment, emphasising the need in Indonesian side to seriously battle
corruption and to have a strong civil society. Juergen Kaiser from Jubilee
Germany agreed with the previous speakers in the need for Indonesia to have a
comprehensive solution for its debt. Kaiser was pessimistic with Paris Club’s
ability to solve the problem and strongly in favour of a debt arbitration
procedure. Francis Lemoine from European Debt and Development (Eurodad) also
asked the creditors to put more attention on the ability of the debtor
country to finance its social programme instead of giving priority to debt
settlement, which according to him had always been a major obstruction for
social development. Despite the rather strong
criticisms from the speakers in the conference, the Indonesian government,
represented by Deputy Coordinating Minister for Economic Affairs Komara
Djaja, defended the government position, emphasising the need to keep in line
with IMF-supported formula for economic reform. Komara said that the
government would only ask for debt rescheduling and possible debt swap
schemes, but not for a debt relief, fearing Indonesia’s investment rank would
fall into the D category, which in turn would further jeopardise the
Indonesian economy. The conference was ended in a
press brief in which the organising NGOs released a joint statement addressed
to the Paris Club meeting. The joint statement and the conference papers are
available at: http://www.infid.be/conference.html. INFID Related Issues Debt International Monetary Fund (IMF)
sees no obstacle for Indonesia to reschedule its external debt in the Paris
Club III. IMF Representative for Indonesia David Nellor said that in this meeting
the creditors would hear about the progress of Indonesia’s IMF-supported
economic reform programme, in which the IMF would lend its support by
addressing the forum. Japan will also support Indonesia in its effort to
reschedule the debt, Finance Minister Boediono stated while praising Japan as
a good supporter. According to Boediono, the creditors joined in the Paris
Club will only want to know about the implementation of government agreement
with the IMF as described in the letter of intent (LoI) IV of December 2001.
"The creditor countries only want the agreement to be
accomplished", Boediono said without explaining whether all agreements
have been executed. Boediono did not see the unfinished business in burden
sharing between the government and Bank Indonesia as a problem either, though
the problem should have been solved in March 2002. Executive Secretary of INFID Binny
Buchori said on 08/04 that Indonesia should not depend on the Paris Club to
solve its huge debt, reminding Paris Club as unfair because they only
consider the monetary factors without thinking on its impact on the debt
solution. Citibank economist Anton Gunawan agreed with Binny saying Paris
Club would be in a position to help in cash flow problem, but would do little
on the reduction of debt burden. Sources: MI 09/04, KT 09/04, Kompas
09/04 Corruption An Indonesian court on 05/04 ruled
parliament speaker Akbar Tanjung to be released from detention pending
verdict in his multimillion dollar corruption trial. He had been detained
since March & in a cell at the attorney-general’s office. The suspension
may have been in accordance with the country’s law but has severely offended
people’s sense of justice, the Jakarta Post wrote on 08/04. Noted lawyer
Frans Hendra Winarta and former attorney general for special crimes Anton
Sujata said the release of Akbar highlighted unfair treatment that could
crush attempts to genuinely enforce the law.Akbar’s co-defendants, Dadang
Ruskandar and Winfried Simatupang had been denied such treatment. Former
Bulog chairperson Rahardi Ramelan, another corruption suspect, even had his
detention extended by 60 days by the South Jakarta District Court at the very
same day Akbar was released. All defendants face up to 20 years in jail if
convicted. The court also announced that former Indonesian president B.J.
Habibie would be summoned to give evidence at the next session on April 15.
But Habibie’s lawyer Yan Juanda Saputra said that the possibility of Habibie
returning to testify was very small due to the health condition of his wife. Sources: AFP 05/04, JP 08/04, ST
09/04 Abbreviations AFP Agence France-Presse Stichting TitanE |