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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Stitch who wrote (3826)	5/24/1998 2:58:00 PM
From: Zeev Hed	Respond to of 9980

Stitch, some people think that we have not seen the worst: biz.yahoo.com Note the interesting closing paragraph when they imply that the Fed will lower interest rates if the current malaise spread to other less developed countries. Zeev

To: Stitch who wrote (3826)	5/24/1998 7:28:00 PM
From: yard_man	Read Replies (1) \| Respond to of 9980

You expected a quicker recovery than 3 years? I thought everyone here had reached some sort of consensus that it would be at least a few years before economic recovery was real. Stock market may rebound sooner than that. Ho would you assess whether enough reform had taken place? Just curious. Wasn't aware that sime darby was involved in brokerage services. That's a useful tidbit.

To: Stitch who wrote (3826)	5/24/1998 9:02:00 PM
From: Stitch	Read Replies (1) \| Respond to of 9980

Gentlemen; re: Indonesia Habibie, who had largely been thought to have his eyes on completing Suharto's term appears to have been served notice that the demand for elections is not going to dissipate. Four cabinet members plus the central bank govenore have called for a speedy general election, stating that the new government must have a mandate form the people. Led by Ginandjar Kartasasmita, Minister for Industry, Finance & Economy the ministries involved inalso include the Finance Minister, Industry & Trade Minister, National Development Minister, and the State Enterprises Empowerment Minister as well as the Bank Governor. This is the who's who of Indonesian business and can be widely viewed as a "no" vote for Habibie's worth as helmsman in the midst of the current economic crisis. This is an especially critical turn of events as it relates to the political stability that the IMF is looking for to restart funding. In the meantime there is power manipulations going on in the military suggesting the possibility of a coup. WSJ has this report: Best, Stitch Habibie Faces Pressure to Speed Reform Amid Call for New Vote By GRAINNE MCCARTHY Dow Jones Newswires JAKARTA -- Just days after taking office, Indonesian President B.J. Habibie is facing mounting pressure to speed political and economic reforms. Several key members of his new cabinet called over the weekend for early parliamentary elections. And the U.S. is suggesting that Indonesia should quicken the process of political reform to win continued financial support and get the International Monetary Fund's $43 billion program for Indonesia back on track. IMF director for Asia and Pacific Affairs Hubert Neiss is scheduled to arrive in Jakarta Tuesday and is set to meet the Indonesian government to assess just when that can happen. Speaking to reporters on the sidelines of the fifth annual Asia Pacific Economic Cooperation finance ministers' meeting in Canada this weekend, U.S. Treasury Secretary Robert Rubin said the Clinton administration isn't taking a hard line on IMF credit to Indonesia, but that certain political conditions must be in place before resumption of aid will receive Washington's support. The IMF doesn't expressly attach political conditions to credits, but Mr. Rubin's comments do indicate a harder line from the U.S. -- the IMF's largest shareholder -- on political reform as a condition for economic aid. "In order for an economic program to work, you have to have political conditions that will allow it to work. And that was quite extensively discussed" by APEC ministers, Mr. Rubin said. IMF Managing Director Michel Camdessus -- also in Canada -- said the fund's board does want assurances there will be political stability to assure the success of the IMF program. He noted the IMF directors are "not so obsessed by political considerations." But he said they are concerned about "the effective working of our program" and therefore are concerned about Indonesian politics. Getting the IMF program back on track is crucial to the success of any government as it battles out the country's worst economic crisis in 30 years. The IMF was scheduled to disburse $1 billion from its $10 billion standby credit arrangement with Indonesia June 4, but the political turmoil derailed a program review that was scheduled to begin two weeks ago. Mr. Habibie assumed the presidency Thursday after Suharto, who ruled Indonesia for 32 years, stepped down amid riots over rising prices and student protests demanding his resignation and political reform. Mr. Habibie, who is viewed with a healthy dose of skepticism by financial markets for his unorthodox economic views, has made no indication that he intends to step down before the end of Mr. Suharto's term, in 2003. But he faces growing pressure to change that. Over the weekend, five government ministers and the central bank governor -- led by coordinating minister for industry, finance and economy, Ginandjar Kartasasmita -- urged Mr. Habibie to call elections. "It is very important that we have a general election as soon as possible," Mr. Ginandjar told reporters on Saturday. "We need to have a new government with a new mandate from the people." Lining up behind Mr. Ginandjar are Finance Minister Bambang Subianto, Industry and Trade Minister Rahadi Ramelan, Minister of National Development Planning Budiono, Minister for State Enterprises' Empowerment Tanri Abeng and Bank Indonesia Governor Syahril Sabirin. The prompt breaking of ranks -- the new cabinet was only sworn in on Saturday -- clearly demonstrates the more open political climate since the resignation of Mr. Suharto. Mr. Ginandjar's move is seen carrying significant weight both here and with the IMF. The minister told journalists he spoke by telephone with Mr. Rubin over the weekend. As head of the main economic and financial team in the cabinet, Mr. Ginandjar is a key point man in negotiations with the IMF. This was further underscored by Mr. Camdessus' praise this weekend for the country's new economic team under Mr. Ginandjar, saying it was "a very solid one, possibly the most solid and credible" that the IMF has dealt with. The cabinet is due to hold its first meeting Monday. Mr. Ginandjar said Saturday that some ministers never intended to serve out their five-year terms when they accepted their posts. Mr. Ginandjar led a group of 11 ministers last week in resigning from Mr. Suharto's cabinet in its 11th hour, which helped pile pressure on the 76-year old to step down. Meanwhile, military chief of staff General Wiranto has pledged to support Mr. Habibie and maintain order on Jakarta's streets. Gen. Wiranto asserted his authority Friday by sacking Mr. Suharto's son-in-law, Lt. Gen. Prabowo Subianto, as the head of the army's Strategic Reserve Command, a key post in the military hierarchy. The purge eliminates a Suharto insider from the all-powerful military, as well as a potential rival to Gen. Wiranto