Indon economy to expand, IMF aid resumption on track: minister (fwd)

[Robert Weissman <rob@essential.org>]

Indonesian economy to expand, IMF aid resumption on track: minister
SINGAPORE, Nov 6 (AFP) - Indonesia's economy should expand two percent next
year after languishing in recession for two years, according to IMF and
government calculations, a top Indonesian minister said Saturday.
Indonesian Coordinating Minister for the Economy and Finance Kwik Kian Gie
also said that details for the resumption of frozen International Monetary
Fund (IMF) aid to Indonesia would be finalised by mid-December.
Kwik was speaking at a business leaders' forum here where Indonesian
President Abdurrahman Wahid explained his new administration's economic
policies to bring Indonesia out of a financial and economic mess.
"Most probably, based on very accurate calculations by the experts of the
IMF, with deficit spending of around eight percent ... economic growth of
about two percent will be achieved," he said.
Indonesia's economy contracted by a massive 13.2 percent in 1998, a year
after the regional financial crisis erupted and plunged most of Asia into
recession.
Economists expect Indonesia to post growth of minus 1.0 to minus 0.1
percent
this year.
Kwik, who has replaced Ginanjar Kartasasmita as Indonesia's economic czar,
said IMF Asia-Pacific chief Hubert Neiss left Indonesia late Friday after
talks with government leaders on the resumption of aid.
In September, the IMF, the World Bank and the Asian Development Bank
blocked
about 4.6 billion dollars in loans after the Bank Bali scandal erupted in
July, implicating senior members of the previous government.
Kwik said he expected a detailed schedule for IMF aid resumption to be
completed by December 15.
"In that sense full cooperation from the international community can be
reassured," he said.
According to reports Saturday, the IMF said its experts would resume talks
in
Jakarta next week on Indonesia's economic plans, including a detailed
letter
of intent listing the policies Indonesia planned to adopt.
Indonesia received an international rescue package worth more than 45
billion
US dollars in 1997, but lending was halted earlier this year because of the
Bank Bali scandal.
Wahib said he looked forward to meeting the IMF delegation next week.
"I think we welcome the new approach by the IMF and we look forward to
helping them in overcoming the problems we face now," he told a news
conference after talks with Singapore Prime Minister Goh Chok Tong.
But the president stressed that the IMF should take into consideration
Indonesia's input into its aid programmes.
He wants to give more emphasis to agriculture and small- and medium-sized
enterprises.
"It should be remembered that we also have our own priorities and the
sending
of a delegation from the IMF is to see whether our priorities correspond
with
their priorities," he said.
Wahid told business leaders that although Indonesia was the world's most
populous Moslem nation, religion would not stand in the way of progress.
"We are persistent in our view that religion should not be tied to the
state
at any level. Islamic law should not be the law of the land," he said.