Jakarta – The International Monetary Fund's (IMF) director for the Asia-Pacific, Anoop Singh, is optimistic that the Fund's meeting with the Indonesian government to discuss the Letter of Intent (LOI) will run smoothly. "We have conducted good meetings," he told the press yesterday.
Singh is in Jakarta with the IMF team to review the implementation of the Indonesian government's economic reform program, and discuss the follow-up to the LOI assessment with Indonesia's economic team, led by Coordinating Minister for Economic Affairs Rizal Ramli on Wednesday.
The mission is also expected to pave the way for the disbursement of a US$400 million loan which has been suspended since last year.
The tranche is part of the US$5 billion loan pledged to the present administration, due to signs that the government's commitment to some important economic reforms is wavering, including the delay in the sale of government-owned shares in publicly-listed Bank Central Asia (BCA) and Bank Niaga.
Also at the meeting were Finance Minister Priyadi Praptosuhardjo, Cooperatives Minister Zarkasih Nur, Manpower and Transmigration Minister Al Hilal Hamdi, and Mines and Energy Minister Purnomo Yusgiantoro. Singh said the meeting is routine, similar to those in previous reviews.
Meanwhile, according to head of Indonesia's negotiating team, Dipo Alam, the IMF team will be here for two weeks. He said that during the first week, the team meeting will focus on the macro-economic budget and the fiscal budget, including the monetary problems of the central bank Bank Indonesia (BI), the Indonesian Bank Restructuring Agency (IBRA) and the privatization of state companies.
He noted that the government has asked that the discussion focus more on the LOI's basic agreement, which is the financial policy for economic recovery. The state budget deficit will be discussed in detail with the Finance Ministry, he added.
On Tuesday, Priyadi said the government is optimistic that the long-awaited meeting with the IMF mission to review its economic recovery program would run smoothly.
"I do not foresee any obstacle because we have fulfilled all the requirements agreed upon in the LOI with the IMF signed September 7 last year," he said.