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INFID News SNO Questionnaire Reminder: The deadline for submitting the SNO
questionnaire has been moved to the second week of August. The questionnaire
is available at http://www.infid.be. INFID Conference Reminder: The 13th INFID Conference
will take place in Yogyakarta on September 30 – October 2, 2002. For
information and registration, please visit our website at http://www.infid.be/conference/. New website INFID Secretariat Jakarta has made major
changes on its website including several updates. Check what the changes and
the updates are at http://www.infid.or.id.
INFID Related Issues Debt On July 17, in efforts to raise money to ease
the government’s growing debt problems, Indonesia’s Bank Restructuring Agency
(IBRA) opened bidding for its sale of bad loans worth a nominal Rp145
trillion. So far this year IBRA has only managed to raise Rp16.5 trillion for
the government, far behind its 2002 target of Rp42.8 trillion. The loan sales
are crucial to restoring some balance sheet health to Indonesia’s account.
Some of the loans are restructured, meaning the debtors are already paying
interest again, and others unrestructured. IBRA will select the winning
bidders on July 24. Winning bidders can either pay for the loans in cash, or
through Indonesian government recapitalization bonds, IBRA stated. Indonesia
pumped billions of dollars worth of bonds into the banks after the 1997
crisis to prop up the system. The bonds account for about two thirds of
financial sector assets, and interest payments on the paper are a major
source of earnings for the banks. Sofjan Wanandi, chairperson of the National
Economic Recovery Committee (KPEN), criticised IBRA for the relatively short
period provided for the bidding process. He said it would only make it easier
for old owners to buy their banks back at huge discounts off of face value.
The law does not allow original debtors to repurchase the loans. But IBRA
admitted it would be hard to prevent them from doing so as they could easily
use proxy buyers. Meanwhile, in her first formal consultation
meeting with parliamentary leaders, President Megawati Sukarnoputri won
support for a key part of her IMF-agreed economic reform programme. The
government has come in for criticism for sticking to some IMF prescriptions
in exchange for a five billion dollar aid program. House Speakers Akbar
Tandjung said both sides agreed to focus on passing four economic bills, of
which state debt instruments will be the priority. Megawati and Vice
President Hamzah Haz also stressed the urgency of completing the bills on
electricity. Officials have said that unless new generating plants are built,
the country could begin to face serious blackouts in coming years. Source: DJ 17/07, AFP 16/07 Corruption The government must cut out the role of
contractors in its procurement policy to prevent the rampant practice of
exhorbitant mark-ups, Maj. Gen. Sudrajad, the director general for defence
strategy at the Ministry of Defence, said on July 10. The current policy,
based on a presidential decree dating back to the 1970s, requires that all
government ministries use contractors to procure their needs. This policy
makes just about all government procurements susceptible to corruption
practices and is grossly inefficient, Sudrajad said. In the past, most of the
lucrative defence contracts went to business owned by the children and
cronies of then president Suharto. The Suharto family pocketed hundreds of
millions of dollars in the 1990s through the mark ups on arms imports for the
Indonesian military. President Megawati Sukarnoputri launched the
debate about the exorbitant mark up practices in defence procurements during
a visit to the Czech Republic last month. Sources:: JP 11/07, AP 15/07 General News Tommy Suharto Tommy Suharto, who turned 40 on July 15, received a birthday present from the state
prosecutors: a 15-year sentence request. The youngest son of former President
Suharto seemed nervous during the four-hour hearing but looked relieved upon
hearing the sentence request. “This is a scandal,” said Muhammad Asrun, a
lawyer at the University of Indonesia and chairperson of a legal NGO. “It
shows that if you have money, you can evade the law”. Tommy is facing charges
of orchestrating a murder, possession of illegal arms and evasion of justice.
Murder carries a maximum penalty of death. Tommy Suharto versus the state: End game http//www.infid.be/tommyvsstate.html. Source: FT 16/07, JP 16/07 Indonesian parliament Told to get serious on political bills,
legislators are requesting additional funds from the government. Yusuf
Muhammad, deputy chairperson of the special committee tasked to deliberate
the general election bill said all members of the special committee must be
committed to prioritising national interests in deliberating the bill to help
democracy. But instead of speeding up the process and improve their
performance, the House leaders and faction chairs told the government to
spend more money to endorse the bills. Legislator Akil Mochtar of the Golkar
Party said the additional fund would be used to finance comparative studies
in foreign countries and consultations with scholars, as well as to outline
the bills and make them available for public consumption. Teten Masduki of
the Indonesian Corruption Watch (ICW) and political analyst Denny J.A. suspected
that the funds, if granted, would be spent on entertainment and other
unrelated activities rather than bill deliberations. In the last session from Jan. 7 through March
28, the House passed only three bills into law despite its earlier set target
of 24 bills. In the current session, which ends on July 19, the House hoped
to complete deliberations on 22 bills. So far the House has endorsed only two
bills. Despite their lack of performance, each
legislators still receive about Rp12.4 million (US$1,370) per month. A
legislator also receives Rp750,000 for every bill deliberated and an
additional Rp300,000 for each hearing with counterparts. Sources: JP 17/07 18/07 Regional News Aceh Aceh Governor Abdullah Puteh joined forces
with the provincial legislative council, clerics and no-governmental
organisations to oppose the imposition of a civil emergency in Aceh. He
revealed that 90 percent of the Acehnese people were against the proposed
imposition of a civil emergency. But Indonesians think otherwise. According
to a nationwide survey, 62% of Indonesians said that a civil emergency should
be imposed on Aceh. Some 43% agreed with the imposition of martial law while
nearly 70% said they were not confident negotiations could resolve the
conflict. Jakarta’s decision earlier this month to brand the Free Aceh
Movement (GAM) a terrorist group found favour with 55% of 613 respondents
surveyed. House Speaker Akbar Tandjung said on July 16
that the parliament opposed the imposition of either civil emergency or
martial law in Aceh. A day before Vice President Hamzah Haz also ruled out
the imposition of a state of emergency though he said the government was
still considering a request from the Indonesian military to beef up security
in Aceh with 8,000 additional troops. But on July17 the House’s Commission I
for defence and National Police chief Gen. Da’I Bachtiar agreed that a state
of emergency for Aceh was necessary to restore security and order in the
province. Sources: JP 14/07 17/07, ST 15/07, DPA 16/07 Abbreviations AP Associated
Press AFP Agence
France Presse DJ Dow
Jones Newswire DPA Deutsche
Presse-Agentur FT Financial
Times JP The
Jakarta Post ST Strait
Times Stichting TitanE |