Indonesia Development Policy Review : The Imperative for Reform

Indonesia Development Policy Review : The Imperative for Reform

Indonesia's recovery was already slowing several months before the events of September 11. Political instability had raised social tensions and slowed reforms--fueling capital flight, alarming investors, and delaying official external finance...

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Bibliographic Details
Main Author:	World Bank
Format:	Pre-2003 Economic or Sector Report
Language:	English en_US
Published:	Washington, DC 2013
Subjects:	ADB AGGREGATE ANALYSIS AGRICULTURE ANTI- CORRUPTION ANTI-CORRUPTION ASSET SALES AUDITS AUTONOMY BALANCE OF PAYMENTS BALANCE SHEET BANK FOR INTERNATIONAL SETTLEMENTS BANK INDONESIA BANK LOANS BANK RESTRUCTURING BANKING SYSTEM BANKRUPTCY BANKRUPTCY PROCEEDINGS BONDS BUDGET DEFICIT BUDGETARY RESOURCES CAPITAL ADEQUACY CAPITAL FLIGHT CAPITAL FLOWS CAPITAL FORMATION CENTRAL BANK CENTRAL GOVERNMENT CIVIL SERVICE CIVIL SERVICE REFORMS CLEAN WATER COMPETITIVE BIDDING CONSUMER PRICE INDEX CONSUMERS CORPORATE SECTOR CPI DEBT DECENTRALIZATION DEMOCRACY DEVELOPMENT PROJECTS DISTRICTS ECONOMIC GROWTH ECONOMIC OUTLOOK ENDANGERED SPECIES EXCHANGE RATE EXPENDITURE EXPENDITURES EXPORT GROWTH FINANCIAL DATA FINANCIAL INSTITUTION FINANCIAL MANAGEMENT FINANCIAL MARKETS FINANCIAL SECTOR FINANCING CONSTRAINTS FISCAL FISCAL DECENTRALIZATION FISCAL POLICY FISCAL SUSTAINABILITY FISCAL YEAR FOREIGN BANKS FOREIGN DIRECT INVESTMENT FOREIGN EXCHANGE FOREIGN INVESTORS FORESTRY FREE TRADE GDP GOOD GOVERNANCE GOVERNANCE REFORM GOVERNANCE REFORMS GOVERNMENT BONDS GOVERNMENT CONSUMPTION GOVERNMENT OFFICIALS GOVERNMENT POLICIES GOVERNMENT REGULATION GROSS DOMESTIC PRODUCT GROWTH RATE GROWTH RATES IMPAIRED ASSETS IMPORTS IMPROVING GOVERNANCE INCOME INFLATION INFLATIONARY PRESSURES INSTITUTIONAL WEAKNESSES INSURANCE INTEREST RATE INTEREST RATES INTERMEDIATE GOODS INTERNATIONAL COMMUNITY INTERNATIONAL DEVELOPMENT INTERNATIONAL RESERVES INTERNATIONAL TRADE INVESTMENT CLIMATE LAWS LEGAL DISPUTES LEGAL FRAMEWORK LIQUIDITY MACROECONOMIC PERFORMANCE MACROECONOMIC STABILITY MINISTRY OF FINANCE MONETARY POLICY MONEY LAUNDERING MUNICIPALITIES NATIONAL DEVELOPMENT NATIONS NET EXPORTS OIL OIL PRICES ORGANIZATIONAL STRUCTURE PARLIAMENT POLICY INTERVENTION POLITICAL INSTABILITY POLITICAL UNCERTAINTY POTENTIAL INVESTORS POVERTY ALLEVIATION PRICE INCREASES PRIVATE CONSUMPTION PRIVATIZATION PROFITABILITY PUBLIC PROCUREMENT PUBLIC PROCUREMENT SYSTEM PUBLIC SECTOR REAL WAGES RECAPITALIZATION REGULATORY FRAMEWORK REHABILITATION REPRESENTATIVES REVENUE MOBILIZATION REVENUE SHARING SECURITIES SERVICE DELIVERY SOCIAL SAFETY SOCIAL SAFETY NET STATE ADMINISTRATION STATE BANKS STATE ENTERPRISES STATE-OWNED ENTERPRISES TELECOMMUNICATIONS TELEVISION TRANSPARENCY TRANSPORT VESTED INTERESTS WAGES WORLD TRADE ORGANIZATION WTO DEVELOPMENT POLICY MACROECONOMIC POLICY EXTERNAL FINANCE DEBT MANAGEMENT STRUCTURAL REFORMS PRIVATIZATION OF PUBLIC ENTERPRISES CORPORATE RESTRUCTURING AGRICULTURAL POLICY ENERGY POLICY MINING DEVELOPMENT GOVERNANCE CORRUPTION IN POLITICS PROCUREMENT JUDICIAL REFORM FORESTRY OPERATIONS POVERTY REDUCTION STRATEGIES GOVERNMENT SPENDING POLICY EMPOWERMENT RICE PRODUCTION MACROECONOMIC STABILIZATION SUGAR INDUSTRY BANK MERGERS ALLOCATION OF RESOURCES
Online Access:	http://documents.worldbank.org/curated/en/2001/12/1660265/indonesia-development-policy-review-imperative-reform http://hdl.handle.net/10986/15452

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Summary:	Indonesia's recovery was already slowing several months before the events of September 11. Political instability had raised social tensions and slowed reforms--fueling capital flight, alarming investors, and delaying official external finance for development. Progress on bank restructuring had slowed and the debt of financially strapped corporations remained largely unresolved. Corruption flourished, unchecked by a justice system that itself was corroded. Regional tensions increased even as the country embarked upon an ambitious decentralization program. And, if real wages are any indication, progress on poverty reduction--encouraging in 1999 and 2000-ground to a halt. Although markets initially welcomed President Megawati Soekarnoputri into office, the new administration has made little progress on structural and governnance reforms in her first one hundred days in office, thus renewing nervousness in markets and worrying external donors and creditors. The events of September 11 have emphatically underscored the urgency of Indonesia's reform priorities. but donors need to be realistic about what is feasible, given strong vested interests, severe institutional weaknesses, the uncertainties arising from decentralization, and a turbulent transition to democracy. Progress is most needed in the key areas of structural reforms, good governance, and empowering and investing in the poor.

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