Jakarta – A steady commitment by the Indonesian government to implement pleged economic reforms will strengthen the ailing rupiah, a top official with the International Monetary Fund said Monday.

"What is needed to strengthen confidence in the rupiah is quite clear – a steady and feasible implementation of economic programs," visiting IMF managing director Horst Koehler said.

Speaking to journalists at the end of a three-day visit before departing for India, Koehler said the weakness of the rupiah was related mostly to poor reform implementation rather than deficiencies in the foreign exchange system.

His comments followed an assurance by Indonesian President Abdurrahman earlier in the day that the government would not introduce capital controls as a means of strengthening the rupiah.

"Strongly backed economic stability and forceful implementation of further structural reforms will no doubt strengthen the rupiah," Koehler said.

Praising Indonesia's accomplishments in implementing economic reform programs – demonstrated by the IMF's prediction of a four percent economic growth this year – Koehler said the country's economic program was "working".

But he quickly pointed out that the four percent projected economic growth alone was "not enough," and that there had to be "more growth in order to reduce poverty and give jobs to the people."

Koehler also said President Abdurrahman Wahid's commitment to "closely monitor" the implementation of the pledged program in his cabinet was "good news particularly for investors."

"Because [that way] they will know that the [government's] direction is clear and it is fully backed by the president and the economic team," he said.

But Koehler warned that he saw "an urgent need" for the Indonesian Banking Restructuring Agency (IBRA) to "accelerate its decision-making" policies. "That means to sell assets, to restructure [state and private] enterprises and banks in order to stimulate investments," he said. "A further delay in the process to sell assets and restructure enterprises would lead to a deterioration of IBRA's assets values," Koehler added.

The IMF is the coordinator of a 46-billion dollar bailout package cobbled together in 1997 along with a reform program to pull Indonesia out of the Asian financial crisis, which started in mid-1997.