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

To: tom who wrote (315)	2/12/1998 8:21:00 AM
From: Duke	Read Replies (1) \| Respond to of 947

FOCUS-Indonesia riot erupts, Suharto warns of plot By Raju Gopalakrishnan JAKARTA, Feb 12 (Reuters) - Hundreds of people rioted in an Indonesian town on Thursday and set shops on fire in protest against rising prices as President Suharto called on the powerful military to clamp down on unrest. The Jakarta stock market index fell over nine percent on news of the riot in the West Java town of Jatiwangi and fears that the government's moves to fix an exchange rate for the rupiah would mean more pain for the battered economy. The giant Asian nation's litany of woes intensified on Thursday as scientists warned of a renewed threat of health-threatening smog over the region from an upsurge of bush fires in Indonesia. An official at the forest fire coordinating bureau in Jakarta said at least 51 ''hot spots'' indicating bush fires had been recorded on Sumatra and 40 in Kalimantan, on the Indonesian side of Borneo island. The fires were burning in areas which had sent smog across neighbouring Singapore and Malaysia for weeks last year, cutting out the sun, slashing tourist traffic and causing eye and lung problems. In Jatiwangi, hundreds of people took to the streets and set fire to at least five shops owned by the ethnic Chinese minority and some cars in protest against food price hikes, residents said. It was the latest in a series of flare-ups across the Moslem-majority nation of 200 million people as inflation and unemployment spread because of the intense economic crisis aggravated by drought. Shops have been looted and set on fire in several towns across Java and the islands of Flores, Sumbawa and Sulawesi in recent weeks after rises in prices of rice, cooking oil and milk. Suharto, a 76-year-old former army general facing the most testing period of his 30-year tenure, spoke of a plot by certain groups to destabilise the government. ''We are currently facing economic and monetary turmoil... There is even a hope that this economic and monetary turmoil will lead to a crisis against the government,'' he told the country's military elite. ''Take stern action against those who violate (the law) and carry out unconstitutional actions, especially those which lead to national disintegration,'' he said. The military, which is guaranteed a political role under the constitution and is the most powerful institution in Indonesia, meanwhile announced that a former close Suharto aide would be its new commander-in-chief. Army chief of staff General Wiranto, a 51-year-old career officer who has served previously as Suharto's adjutant, was named to replace outgoing military chief General Feisal Tanjung. Signs strengthened meanwhile that another Suharto confidante, Research and Technology Minister Jusuf Habibie, could become vice-president in the indirect presidential elections in March. Suharto himself has accepted nomination for a seventh five-year term in office and is basically assured of victory. Habibie is considered by economic analysts as a financial maverick and the rupiah currency plunged to a historic low of 17,000 to the dollar when hints first surfaced last month that he may become vice-president and the potential successor to the ageing Suharto. Currency market dealers said the rupiah dropped to a low of 7,800 to the dollar from a 7,700/800 open on news that the ruling Golkar party had nominated Habibie and party chairman Harmoko as its choices for the vice-presidency. The currency remained soft in late trade at 7,600/7,700 to the dollar as reservations spread about when Indonesia would announce a fixed peg for the rupiah -- expected at around 5,500 to the dollar -- under a currency board system. News of the riots also unsettled the market, dealers said. The stock market was also affected by the Habibie factor, but brokers said the riots in Jatiwangi and fears that adoption of the currency board would lead to a sharp spike in interest rates predominated. The composite index closed down 9.29 percent at 442 points. Political analysts said the fact that Wiranto, also a possible candidate for vice-president, was being promoted was a sign Habibie had become the front-runner. Other analysts suggested that the move in fact strengthened Wiranto's chances of being Suharto's running mate, although the former presidential adjutant was possibly of more value as armed forces' commander. In announcing his replacement next week by Wiranto, a Javanese Moslem, outgoing commander Tanjung avoided naming the military's preferred candidate for vice-president. Analysts also said Golkar's naming of Harmoko as one of the potential candidates was in case opposition to Habibie mounted from within the ruling elite. Current Vice-President Try Sutrisno is also in the running for re-nomination and analysts said intense jockeying continued behind the scenes for the post. Habibie told reporters after a meeting at Suharto's office that he did not want to comment on the nomination until a decision was made by the People's Consultative Assembly, the electoral college for the presidential elections.