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Central bank not a political tool: Kadin chairman

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Antara - September 8, 2003

Bengkuliu, Bengkulu – Chairman of the Indonesian Chamber of Commerce and Industry (KADIN) Aburizal Bakrie reminded everyone that Bank Indonesia was the country's monetary authority. It could not be used as a political instrument for a certain party or ruling party.

Turning the bank into a political instrument for the sake of certain political interests was against economic principles, he said here over the weekend.

The central bank, he said, should be granted a full mandate to maintain the dynamic stability of inflation, interest, and exchange rates.

The stability of exchange rate is important for businessmen, he said, adding that stable rupiah will facilitate the investment planning for them.

He further said the bank's autonomy status does mean that it has to "close its eyes on any surrounding condition". "The bank should be able to touch on the heart of national economy," he added.

In certain condition like this current time, the central bank should be able to boost expansive monetary policies to support the real sector.

The banking sector, he said, has been able to obtain the people's fund mounting to Rp890 trillion (US$104 billion), but only Rp425 trillion is returned to the public, while the remaining Rp465 trillion remains an unproductive fund.

"If the bank can accelerate the disbursement for investment in the real sector, the economic wheel may move and the business world will be able to give hopes to millions of jobless people," he added.

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