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Technology Stocks : INDONESIA'S PT TELECOM(TLK) -- Ignore unavailable to you. Want to Upgrade?

To: Duke who wrote (288)	2/9/1998 8:49:00 PM
From: Duke	Respond to of 947

Tight security in Indonesian city after riot over price hike ------------------------------------------------------------------------ JAKARTA -- Tight security was in place in the town of Bima on the eastern Indonesian island of Sumbawa yesterday, following a riot over price hikes on Saturday, police said. "The situation is calm, everything is going as it should be. But shopowners probably still don't dare to stay open today," civil shopowners probably still don't dare to stay open today," civilian police official Nasir said a day He said the rioting, mostly on the town's main shopping street, had been brought under control by late Saturday afternoon. Officials declined to comment on whether anyone had been arrested over the riot. Bima is located some 1,350 km east of Jakarta. Police Captain Bukran said the violence erupted after hundreds of people went to the local parliament building in the town of 500,000 to protest against rising prices of basic goods. In Jakarta, troops and police maintained high visibility yesterday, a day after a massive show of force and a warning of unrest from armed forces commander General Feisal Tanjung. Invalid rule Gen Feisal, inspecting 22,000 military and police personnel on Saturday at a downtown parade ground bristling with fire-power, told the forces to be on guard against unrest in the capital in the lead-up to next month's meeting of the People's Consultative Assembly (MPR), when the president and vice-president for the next five years will be chosen. Violence over the soaring prices of staple goods has broken out in more than 10 Indonesian towns and cities in the last two weeks. The angry mobs have generally targeted shops owned by ethnic Chinese, traditionally victims in times of unrest in Indonesia. The ethnic Chinese minority numbers only some five million people, but is believed to hold around 80 per cent of the wealth of the country of 200 million people. More than 90 per cent of the population are Muslim. The rupiah's steep fall against the US dollar and the economic slowdown that ensued have pushed prices up, and in many cases also made basic goods scarce. -- AFP.

To: Duke who wrote (288)	2/9/1998 9:50:00 PM
From: Duke	Respond to of 947

Currency board not appropriate for Indonesia-Chase NEW YORK, Feb 9 (Reuters) - The Indonesian government, which has watched its currency plunge since July, would be poorly served by adopting a currency board, Chase Securities said in a research report. Jakarta has been studying the possibility of a currency board, which would peg the rupiah to a foreign currency at a specific exchange rate, but Chase analysts wrote this medicine would not fit Indonesia's ailments. ''It is not evident that the Indonesian economy would be best served by a rigidly pegged exchange rate,'' said Chase analysts Karen Parker and John Normand. ''This particular option would not be appropriate to Indonesia's circumstances and looks unlikely to be adopted.'' The rupiah followed a steady downward crawl against the U.S. dollar from 1987 to 1997, prompting steady growth of non-traditional Indonesian exports, the Chase report said. ''Without this flexibility, the adjustment of real wages and employment to terms of trade shocks would have been quite painful,'' Chase said. Indonesian authorities have actively managed the exchange rate over the past 30 years, and allowed periodic devaluations in 1978, 1983 and 1986. Indonesia, through currency realignment, managed to avoid a significant slowdown in growth during the mid-1980s amid a drop in oil prices, a rise in global interest rates and a weak dollar against the yen, the analysts said, noting that much of Indonesia's debt is denominated in yen, whereas oil prices are denominated in dollars. Chase pointed out that an adoption of a currency board would ''restrict'' the authorities' room for fiscal discipline. Many Indonesian banks would be be unable to bear the financial pressures accompanied by a rigid currency board, a fact ''that would be amply clear to market participants, undermining the credibility of such an arrangement at the outset,'' Chase said. The Chase analysts acknowledged that stabilizing the currency is the first step to help Indonesia's ailing banking system, but said a currency board was not the only means toward that end. ''A resolution of the current political uncertainty and steady implementation of the (International Monetary Fund's) adjustment program, as has been done in Thailand and South Korea, would go a long way toward restoring confidence,'' the Chase analysts added. In New York trading, the rupiah stood at about 9,500 against the U.S. dollar on Monday compared with around 2,400 rupiah in June last year, before the currency crisis erupted.