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Following criticism from both right and left of a visit this
week by International Monetary Fund (IMF) managing director Rodrigo de
Rato, the government says it will confine the discussions with de Rato
to talks on the latest developments in the Indonesian and global
economy.
Coordinating Minister for the Economy Boediono said the meeting with de
Rato on Tuesday evening would not discuss the politically sensitive
issue of new loans for Indonesia from the Fund, and that any
discussions on cooperation would be confined to the "technical" level.
"We will consider any offers of technical assistance or the assignment
of field experts, whether they would indeed be useful to us or not,"
Boediono was quoted by Antara as saying Tuesday before the meeting.
Boediono further said that Indonesia was now a regular member of the
IMF so that it no longer had any obligations to the Fund that would
affect the government's economic policies.
"Rest assured that we are now running our own policies. There is nobody
dictating to anybody anymore," he said.
The Fund's resident representative for Indonesia, Stephen Schwartz,
also said there would be no discussion of new loans during the meeting.
"Mr. de Rato just wants to know how Indonesia will anticipate any
economic challenges ahead, and if the IMF can support Indonesia in
this," Schwartz said.
"So far, we are seeing Indonesia as being on the right track in terms
of the government's policies and agendas. Indonesia's economy is now
stronger."
Schwartz further said that Mr. de Rato will also explain the current
reforms taking place in the IMF.
Mr. de Rato will be in Indonesia until Wednesday, meeting with
government officials, business leaders, representatives of the private
sector and academic experts.
His visit forms part of a three-nation tour around the Asia Pacific
region. He visited Japan on Jan. 21 and 22 to attend a regional central
bankers meeting, and will visit China on Jan. 25 and 26.
Indonesia last year repaid US$7.8 billion to the IMF, thereby closing
the book on years of a politically sensitive relationship with the
Washington-based global financial agency.
Between 1997 and 2003, the IMF provided some $25 billion in loans to
help Indonesia rescue its banking system, rehabilitate the economy by
restructuring private and government debt, and strengthen its foreign
exchange reserves.
Criticism however arose as the loan program called for the government
to implement a number of tough economic reform programs under IMF
supervision, including privatizing state firms and reducing subsidies,
which many nationalists saw as damaging the nation's interests without
significantly improving the economy. Foreign debt costs have also been
criticized for siphoning off funds that could have been used for
welfare development.
The government, under public pressure, eventually terminated its
program with the IMF at the end of 2003, but still remained under the
Fund's "post-program monitoring" to assess the government's own reform
targets. Last year's final debt repayment brought this monitoring to an
end.
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