Jakarta – The World Bank yesterday welcomed the appointment of Ms Megawati Sukarnoputri as Indonesia's new president, and urged her to assemble a strong economic team to tackle the country's daunting problems.

"This is a time of great challenge and opportunity for Indonesia," bank president James Wolfensohn said in a statement two days after Ms Megawati's appointment.

"President Megawati's government faces the daunting task of rebuilding the economy, tackling corruption and reducing the poverty facing many Indonesians," said Mr Wolfensohn, who sent a congratulatory letter to the new leader.

He expressed confidence that with persistent effort, Indonesia would prosper under Ms Megawati's leadership, saying the bank looked forward to working closely with her new economic team, which has yet to be announced.

The World Bank's Indonesia manager, Mr Mark Baird, said the peaceful transfer of power "heralds a period of greater political stability" and was good news for the market and investors. "The key now will be to seize this opportunity to push ahead with urgently-needed economic and institutional reforms," he said.

The World Bank is one of Indonesia's largest foreign creditors. The country's overall outstanding overseas debt stood at US$140.2 billion as of January, comprising $74.2 billion in sovereign debt and $66 billion in private- sector debt, according to the central bank.