Sign up | Log in



Home  >>   Daily News  >>   Indonesia News  >>   Economy  >>   Corruption a threat to Indo economy
NEWS UPDATES 17 September 2010

Corruption a threat to Indo economy

Related Stories

September  10, 2010
Indonesia more competitive than ever

September 6, 2010
Indo banks facing difficulties with micro credit

August 27, 2010
Indo banks to meet new LDR rules

August 16, 2010
Indonesia's GDP predicted at 6.3percent in 2011

August 14, 2010
Cheap rice to be distributed to Indo poor

August 2, 2010
U.S. firm produces more Indo copper, gold

The International Monetary Fund (IMF) has warned Indonesia must make fighting corruption a priority if it wants to build on its progress as one of the world's best-performing economies.

Southeast Asia's biggest economy expanded by 4.5 percent in 2009, the third fastest in the Group of 20, and is poised for accelerated growth in the years ahead, the IMF said in an annual report.

But it said foreign investors who are needed to fund Indonesia's expansion into a regional powerhouse would be cautious until more is done to fight rampant corruption and improve the rule of law.

"A decisive and successful response, as well as a decade of sound policies and structural reform, helped Indonesia recover quickly from the 2008 global crisis," the report said.

"However, lingering concerns over weak enforcement of the rule of law, transparency, and governance issues, weigh on market perceptions. Addressing these weaknesses should be a priority."

The IMF praised Indonesia's "remarkable achievements" over the past decade, as it transformed into a flourishing democracy and recovered from near-bankruptcy in the 1998-1999 Asian financial crisis.

Indonesia was forced into a US$43 billion bailout from the IMF in 1998, and only exited supervision by the Washington-based organisation in 2003.

But the IMF said Indonesia "still faces challenges to preserve financial stability and develop its financial system", especially in areas such as supervision and the development of the non-bank sector.

"Market participants view Indonesia as a country with great potential, supported by a large consumer base and rich in natural resources," the report said.

"Yet, Indonesian securities continue to trade at a discount relative to regional peers and many wealthy Indonesian individuals still prefer to place their savings offshore.

"The financial sector lags behind comparable countries in terms of depth and contribution to the economy. This is because weaknesses in the legal and governance framework undermine investor confidence."

It said one of the consequences of the legal uncertainty was that "large corporate borrowers have the economic clout to challenge contracts".

Reach Southeast Asia!
10- Nations, 560- Million Consumers
And $1 -Trillion Market
We are the Voice of Southeast Asia Media Kit
The only Media Dedicated to Southeast Asia Advertising Rates for Magazine
  Online Ad Rates

Comment on this Article. Send them to

Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below




1.  Verifier

1. Verifier

For security purposes, we ask that you enter the security code that is shown in the graphic. Please enter the code exactly as it is shown in the graphic.
Your Code
Enter Code

Home | About Us | Contact Us | Special Feature | Features | News | Magazine | Events | TV | Press Release | Advertise With us

| Terms of Use | Site Map | Privacy Policy  | DISCLAIMER |

Version 5.0
Copyright © 2006-2021 TIME INTERNATIONAL MANAGEMENT ENTERPRISES CO., LTD. All rights reserved.
Bangkok, Thailand