The Indonesian elections are set for tomorrow (I think), and there seems to be some genuine concern about them moving away from businesses being run by the Suharto's. I have seen some analysis from the South China Morning Paper about the domino effect this can have for all of the Asian economies, because of Japan's outstanding loans there, and the capital that may be drawn away from S. Korea, Singapore, Hong Kong, etc. Not sure how concerned to be about this, but last time they got a cold, my portfolio got the runs.
World Bank Official: Indonesia Poses Risk To Neighbors
TOKYO (Dow Jones)-The prospects for a sustained economic recovery across southeast Asia hinge on conditions in Indonesia, where recent developments have been "mixed," a senior World Bank official said Tuesday.
Mark Malloch Brown, vice president of the World Bank External Affairs Department, said during a press conference, "We can be cautiously optimistic about progress around the rest of the region, but much hinges on the thread of a successful resolution of problems in Indonesia. The signals there have been mixed."
Brown warned that renewed instability in Indonesia could cause a contagion effect in neighboring countries, putting in jeopardy the nascent recoveries in those countries.
Brown said Indonesia's problems largely reflect political issues rather than the state of the real economy and he emphasized that unless President Suharto can restore confidence in his leadership, "There's very little we or anyone else can do for him."
satellite.nikkei.co.jp |
