Dow Jones Newswires 
October 17, 2000

US "Reassured" By Indonesia Promises At Tokyo Donor Meeting

TOKYO -- The head of the U.S. delegation to an aid meeting for Indonesia said Tuesday that the U.S. has been "reassured" by the Indonesian government's promises on dealing with militia gangs terrorizing refugees in West Timor and on other matters.

However, the delegation head, Robert Randolph, said that meeting participants hadn't made a decision on pledging aid.

"We've been reassured by the promises made by (Indonesian senior economic minister Rizal) Ramli," said Randolph, who is the assistant administrator for Asia and the Near East at the U.S. Agency for International Development.

"We're going to trust Mr. Ramli but verify" whether Indonesia follows up with action, he said on the sidelines of the donor meeting.

The World Bank is sponsoring a two day meeting in Tokyo of aid donors for Indonesia. The closed meeting is chaired by Jemal-ud-din Kassum, World Bank vice president for East Asia and the Pacific, who last week linked support for aid to Jakarta's progress in reining in the militias.

Indonesia is under international pressure to disarm and disband pro-Indonesian East Timorese militia gangs that killed three U.N. aid workers in West Timor last month.

Jakarta is looking for help in bridging an expected budget deficit of 52.12 trillion rupiah ($1=IDR8,895) in 2001.

Donors are expected to urge Jakarta to come up with other ways to help deal with the deficit, such as quicker sales of state assets. The 2001 deficit is expected to hit 3.7% of gross domestic product.

Jakarta wants $4.8 billion from donors for the 2001 budget, but the U.S. wants to link the aid to resolutions of killing in West Timor that left three U.N. aid workers dead last month.

Asked whether the U.S. was satisfied enough with the Indonesian response to pledge aid, Randolph said, "we still have more sessions."

Randolph said that political and economic problems were intertwined in Indonesia, and that the reason that foreign investor sentiment toward Indonesia is still weak was because of the political and security problems. The rupiah has fallen about 20% this year, and stocks are nearing 18-month lows.

-By James Simms, Dow Jones Newswires; 813-5255-2929; james.simms@dowjones.com

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