Politic-Economic-Society-Tech

Megawati Gets Down To Business In Indonesia

A power struggle in the world's biggest Muslim country yesterday saw Indonesia's Parliament strip Abdurrahman Wahid of the presidency and hand it to his deputy, Megawati Sukarnoputri, reports the Financial Times (p.1). Megawati was sworn in yesterday after receiving support in Parliament. However, Wahid refused to leave the presidential palace or resign, insisting that he was still Indonesia's constitutional leader. 

Meanwhile, the assertion of power by the legislature was applauded by foreign leaders and international investors, the story notes, saying they expressed hope that Wahid's ousting would end months of political instability. US President George W. Bush said he looked forward to working with Megawati, and urged a peaceful resolution to the country's crisis. "We hope all parties will work together to maintain peace, support the constitution and promote national reconciliation," he is quoted as saying. 

Megawati, whose term extends until 2004, faces the challenge of leading Indonesia out of the aftermath of the Asian economic crisis of 1997-1998 and restoring law and order, the story says. 

In a related story, the Wall Street Journal (p.A12) adds that the IMF has suspended its lending to Indonesia, citing Jakarta's failure to implement reforms it promised in return for the money. The IMF wants Jakarta to privatize key banks, for example, and is seeking assurances that the government won't implement a controversial plan that some fear will weaken the central bank's autonomy. 

Agence France-Presse reports that former coordinating minister for the economy Burhanuddin Abdullah said today ministers in the outgoing cabinet were continuing their work with the IMF. In her first move after her appointment, Megawati announced she was decommissioning the cabinet of her predecessor, but also ordered the ministers to keep working-although they should not make any major decisions without her approval until the new cabinet was formed. 

IMF executives and the government on Friday agreed on a draft letter of intent outlining Jakarta's reform pledges in return for a $400 million aid tranche, the story notes. The letter has to first be approved and signed by the IMF board before it will allow the release of the stalled loan tranche, which has been held up since December because of Jakarta's alleged foot-dragging on economic reforms.

source: WorldNews.com, 24 Jul 2001