Indonesia and IMF to finalize agreement in two weeks (fwd)

[Robert Weissman <rob@essential.org>]

Indonesia and IMF to finalize agreement in two weeks
JAKARTA, Nov 23 (AFP) - An International Monetary Fund (IMF) technical team
will return here in two weeks to finalize a draft of Indonesia's latest
letter of intent on its economic bailout package, the country's economic
czar
said Tuesday.
Coordinating Minister for the Economy, Finance and Industry Kwik Kian Gie
said the government and the IMF had agreed on the draft following a
two-week
review by the team of the government's programme, as part of the
43-billion-dollar bailout plan.
"In general, the coming letter of intent will cover broader areas," Kwik
said.
IMF team head Anoop Singh told journalists he "really expects that the new
letter of intent will be approved next month."
The letter of intent would cover medium-term broad economic policies,
macroeconomic policies and structural reforms, Kwik said.
Indonesia's broad economic policies, he said, will include reconstruction
of
economic institutions and improvement in the exploitation of natural
resources.
The macroeconomic policies will cover fiscal and social safety net
policies,
monetary and exchange rate and balance of payments.
The structural reform will include trade policies, banking reform,
corporate
and law reform, privatisation of state enterprises and healthy competition
policies.
It will also cover other structural reforms in areas such as agriculture,
forestry, environment and small- and medium-size enterprises.
"The details of the new letter of intent will be released once they are
approved by the president and the IMF executive board," he said.
Asked if the new letter of intent would be used by the IMF to pressure
President Abdurrahman Wahid's new government, Kwik said: "No, I didn't even
discuss that issue at all ... there are no traps, there are no (hidden)
political agendas at all."
Kwik added that the new letter of intent was aiming "strictly for
Indonesia's
economic recovery."
However, the Indonesian parliament will reject a proposal by the government
to gradually lift fuel subsidies, demanded by the IMF, a senior official
said.
"If the government needs additional funds for the state budget, better find
other sources. Eliminate corruption seriously, don't sacrifice the people's
interest," Antonius Rahail, deputy chairman of the parliament's commission
on
mining said, quoted by Kompas daily.