IMF admits wrong doing in Indonesia

The International Monetary Fund ( IMF) admitted that it had done "a wrong doing" during cooperation with Indonesia over ten years ago and would learn from the lesson, Managing Director of the IMF Dominique Strauss-Kahn said on Wednesday.

"We've drew a lesson from the way IMF and Indonesia worked together ten years ago. And certainly we did also something wrong and we have to accept that. So we've learnt this...," the director told a press conference after meeting with Indonesian President Susilo Bambang Yudhoyono at the State Palace.

Indonesia, which was one of the IMF debtors, paid all its debt to the international financial institution in 2006 after the country exited from the 1998/99 Asian financial crisis.

The director said the IMF today appeared with a better performance, which has changed from the past.

"So we're a new institution, a multilateral institution which is built to help the membership and having learnt from the past, including the Asian crisis, we want to be able to provide our membership with the best possible advice and with support when needed," the director said.

He said that with the reforms it had done, the IMF reflected a better state of the world and Indonesia had a bigger role.

"The main message today is simple: we have to look forward. The IMF has changed, we have a new IMF where the voting power and the voice of Asian countries have increased a lot. The last reform we made in the governance changed the IMF to reflect better the state of the world. And in current state of the world, Asia in general, Indonesia in particular, has a bigger role than in the past," the director said.

Indonesia has built strong fundamentals and stability which made it survive from the global financial routs in 2008/2009, then the country's economy developed to a growth of expected 6 percent in 2010.

Indonesia has nearly jumped to investment grade, as Moody's Investor Rating agency recently raised Indonesia's grade to one notch below investment grade.

The IMF forecast Indonesia's economy would accelerate at 6 percent this year and saw no problem which may hamper the growth, the budget deficit of 1.8 percent was considered reasonable.

"I expect a rather high growth for Indonesia this year, it can be over 6 percent. I don't see any real problem (which may affect growth) on this time. The budget that has been prepared is a budget with a higher deficit than last year's but still a very reasonable one," he said.

Although Indonesia has no need to have a fresh loan from the IMF at present and in the near future, the director said the international organization still build cooperation in the region.

"Nevertheless, we'll never know. That's why we're working with regional institution like Chiang Mai initiatives to try to build something for the region," he said. Source: Xinhua