Robert Go, Jakarta – The country's top economics minister has berated the Indonesian Bank Restructuring Agency (Ibra) for working at a snail's pace and said it was a long way from meeting its projected contribution to this year's national budget.
In a televised interview on Tuesday, Coordinating Minister for Economy, Finance and Industry Kwik Kian Gie expressed anger that Ibra had generated only 3 trillion rupiah (S$630 million) this year from selling assets under its control.
That sum is a far cry from the 18.9 trillion rupiah the agency has promised to inject into the government's coffers during the fiscal year ending in December.
"I am frustrated and angry with Ibra's progress and I have expressed this to its management," he said. If Ibra failed to meet its financial obligation to the state, Indonesia might have to revise its governmental budget, he said.
Calculated using an exchange ratio of 7,000 rupiah to the US dollar, the budget is already in danger of being revisited because of the currency's 20 per cent depreciation during the past two months.
In addition to its failure to speed up its asset disposal programme, Mr Kwik took issue with Ibra's soft treatment of some Indonesian conglomerates. "How is it possible for conglomerates that clearly wrecked the economy to retain control of their companies?" he asked.
His comments followed a report by Ibra vice-chairman Arwin Rasyid that revealed the agency had sold only 2.5 per cent of all assets under its control during its two-year history. The most recent estimate puts Ibra's holdings at US$66 billion.
Mr Arwin also admitted that compared with similar asset-disposal agencies operating in other countries hit hard by the Asian economic crisis, Ibra has turned in a sub-par performance. According to his figures, South Korea had unloaded 38 per cent of its US$55 billion, while Thailand has sold 78 per cent of the US$22 billion assets under state control.
Mr Arwin further indicated that Ibra's plans include raising 23 trillion rupiah during the 2001 fiscal year, but that the agency might have to revise that forecast downward. "Perhaps Ibra must be more realistic in forming its projections," he said.
Although he did not provide explanations for his agency's poor record, he said that political and economic stability remained crucial to the process of getting foreign investors to snap up Ibra's sale offers.
Ibra has a five-year deadline and has been given the task of helping revamp Indonesia's chaotic banking industry by 2003. Its mission is to take over and restructure troubled banks and dispose of their assets and collateral quickly to finance the economic-recovery effort. However, the International Monetary Fund joined the agency's critics recently and said Ibra held on to assets under its management for too long.