Subject: Attorney-General says aid donors press Indon on W. Timor, Manulife

AG says aid donors press Indonesia on West Timor

JAKARTA, April 24 (Reuters) - A meeting of international aid donors in Jakarta on Tuesday pressed Indonesia over its progress in the case of three U.N. workers killed in West Timor last year and on a high profile international share purchase row.

Attorney-General Marzuki Darusman said donors raised the two issues in the second and final day of talks with donors under the banner of the Consultative Group for Indonesia (CGI) who are reviewing the country's reforms ahead of its annual summit later this year.

"...Punishment of the killers of the U.N. staff in Atambua, the Manulife case," Darusman told reporters when asked what the key agenda items included.

The CGI -- chaired by the World Bank and comprising 30 member countries -- pledged $4.8 billion in loans to Indonesia at its annual gathering in Tokyo last October.

If donors find Indonesia has failed to implement commitments during the current two-day meeting, the disbursement of the much-needed loans could be held up.

The brutal slaying of three U.N. workers in the West Timor border town of Atambua last September, which drew wide international condemnation, was a key concern of donors at the Tokyo summit.


They warned Indonesia its chances of securing the $4.8 billion would partly depend on its efforts at reining in violent pro-Jakarta militia gangs.

Indonesia's military and police set up the militias in an unsuccessful attempt to sway last year's U.N.-brokered independence vote in East Timor.

When the territory voted to end Jakarta's brutal military occupation, the militias, backed by the military and police, laid waste to the territory, killing hundreds and herding 300,000 men, women and children into Indonesian West Timor.

There are six suspects in the Atambua case and the verdict is due to be handed down at the North Jakarta Court on Friday.

Darusman said donors also quizzed Indonesia on the share purchase dispute involving a local unit of Toronto-based Manulife Financial Corp.

The case has further eroded investor confidence in the country at a time when it is desperate for new money to pull it out of prolonged economic crisis.


"It is now under investigation whether it could become a case or not. If there is no case we will close it," Darusman told reporters.

The dispute surfaced in October when Manulife tried to increase its 51 percent stake in local insurance firm PT Asuransi Jiwa Manulife Indonesia (AJMI).

Manulife paid around $20 million for a 40 percent stake in AJMI in a government-backed auction to raise its stake in the firm to 91 percent.

The World Bank's financial arm, the International Finance Corporation (IFC) owns the rest.

The 40 percent stake came from bankrupt Indonesian company PT Dharmala Sakti Sejahtera which was the joint venture shareholder in AJMI.

But a mysterious British Virgin Islands company Roman Gold Assets later emerged to claim it had bought the stake from a Samoan company for $50 million a week earlier.

Roman Gold then filed a police report alleging the shares held by Manulife had been forged.

The issue has triggered an angry response from the Canadian government and last November Manulife filed a criminal suit against Roman Gold and Dharmala Sakti chief Suyanto Gondokusumo.

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