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New Straits Times Press (NSTP) Interactive, June 24, 1999
Habibie Says Indonesia's Economy Is Leaving Its Rockbottom Level
JAKARTA, June 24 (AFP) - Indonesian President B.J. Habibie said
Thursday the economy was over the worst and on the path of
recovery, but warned that political stability held the key to
continued growth.
"After about one year, steps taken to restore the economy have
shown indications that (it) ... has risen from its lowest point
and has begun to improve," Habibie told a meeting of importers.
He cited positive quarter-on-quarter Gross Domestic Product
growth in the three months to March, a strengthening of the
rupiah to below the 7,000 to the dollar level, and negative
inflation for the past three months.
"With the stable and improving rupiah and reined in inflation,
gradually bank interest rates will be able to be lowered so that
by the end of the year the rate is expected to be below 20
percent," Habibie said.
Top economic minister Ginanjar Kartasasmita also said Thursday
that he believed interest rates could fall to below 20 percent
as early as next week.
"The interest rate next week can reach below 20 percent and I
think in July it will just even lower," Ginanjar said before
attending a cabinet meeting.
But he added that interest rates should not be lowered too fast,
warning: "If it goes down to fast, people will then shift to
speculating in dollars or goods,"
Central Bank Indonesia Governor Sjahril Sabirin said separately
that he expected the Indonesian Consumer Price Index (CPI) to be
lower or unchanged in June compared to May, when it fell 0.28
percent month on month.
"I haven't seen any figures yet but I have heard that there is a
possibility it (inflation this month) will be like last month
again -- it may be negative or close to zero."
Habibie also said domestic consumption had begun to recover and
success in restructurizing the banking sector will spur growth
in other sectors such as trade, industry, property, transport
and telecommunications.
The improving economy would also spur more exports and imports,
he said.
"We have to continue to make efforts so that our imports are
mainly to support productive activities and not consumptive
ones," Habibie warned.
He said the economic improvements were the results of economic
policies that were compatible with political policies.
The largely peaceful June 7 parliamentary elections had also
sparked a positive reaction from the markets, he added.
He said political stability "should be maintained and even
strengthened so that our economic recovery can proceed even
faster."
"Therefore, on this occasion I would like to remind that
political stability needs to be supported by a good and correct
understanding of the process and stages of the agreed elections
system in particular and of democratic values in general," he
added.
Indonesians voted to elect 462 parliamentarian representatives
on June 7.
The MPs will join 38 non-elected military representatives and
200 others representing the regions and non-political
organisations to form the People's Consultative Assembly (MPR)
which will select a new president in November.
"Let us completely trust he national leader selection process of
our 700 representatives who will sit at the MPR," Habibie said.
Habibie also called on the people to remain patient in awating
the final results of the June 7 general polls. The official
tally has so far trickled in with only just over half of some
112 million expected votes counted.
"We hope, God willing and with the support of all the people,
the political process as part of the democracy that we are
currently going through can run smoothly so as to support
economic recovery efforts," he said.
The polls, contested by 48 political parties, were the first
since the downfall of former president Suharto who resigned in
May of last year.
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Didistribusikan tgl. 28 Jun 1999 jam 07:43:06 GMT+1
oleh: Indonesia Daily News Online <IndoNews@indo-news.com>
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