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Web-only Exclusives
November 30, 2000

From Our Correspondent: Hirohito and the War
A conversation with biographer Herbert Bix

From Our Correspondent: A Rough Road Ahead
Bad news for the Philippines - and some others

From Our Correspondent: Making Enemies
Indonesia needs friends. So why is it picking fights?

Asiaweek Time Asia Now Asiaweek story

SEPTEMBER 24, 1999 VOL. 25 NO. 38

'We Were Surprised'
Ginandjar on East Timor and Bank Bali

    ALSO IN ASIAWEEK
On the Firing Line
Habibie gives in to international pressure over foreign intervention -- but his problems are far from over

It's the Army, Stupid
Ramos-Horta on Indonesia's real problem

Indonesia Pays the Price
Savagery and scandal test the economy

Timor's Trail of Tears
Refugees face violence, starvation and exile

'We Were Surprised'
Ginandjar on East Timor and Bank Bali

  RELATED STORIES
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Breaking news from Southeast Asia

With both President Habibie and Foreign Minister Ali Alatas staying away, Ginandjar Kartasasmita, coordinating minister for economy, finance and industry, had the unenviable task of being Indonesia's most senior official at this year's APEC meetings in Auckland. He was predictably grilled over his government's policies, though the pressure eased slightly after Habibie agreed to a U.N. peacekeeping force. In between the meetings, the embattled minister spoke with Senior Correspondent Alejandro Reyes. Excerpts from the interview:

Why have you been unable to keep law and order in East Timor?
It actually started with the New York agreement [which set the framework for the vote]. Under the agreement Indonesia was required to reduce the presence of its military, so we did it. But then we were surprised by the militias' reaction. We were simply undermanned, and the police were not equipped for this kind of thing.

How do you feel about the violence?
It is upsetting, but it has happened.

What is the reaction of the government and the military to the vote in East Timor?
Some people are surprised, some are disappointed. There is no unified view within the government. The same with the military. Of course, the military would probably have been happier if East Timor had remained, but the decision has been made and they will abide by it.

What about talk of a coup? Is President Habibie in control?
I can assure you that it is all talk. In Indonesia we have no tradition of military coups. It's never been done before. It's just not the character of the Indonesian military to stage a coup. They are the guardian of the Constitution and are committed to the democratic process. Definitely I can assure you President Habibie is in control of the military.

The Bank Bali affair and East Timor must have made your job harder, particularly in dealing with the IMF and the World Bank.
With Bank Bali, the IMF and the World Bank have genuine reason to be involved -- it is an economic problem, a specific problem in our restructuring program. But on East Timor, I am concerned that those institutions have gone beyond their mandate and violated their charters. The IMF and the World Bank have no business in East Timor. Involving themselves in this political issue is a bad precedent and in future will be self-defeating and regretful.

Where are we now with Bank Bali?
We will find out the truth. After news [of the scandal] broke, we forced the bank to return the money, appointed independent international auditors and started a police investigation. We did all this in a month without being told by anyone. There is no intention on our part for a cover-up. If the market feels there is a cover-up, it will hurt the economy very badly; people will no longer trust our recovery program. It has already done some damage, but we are trying to repair it. In fact, there's a silver lining. Now we recognize that there are some loopholes in the system. So we've asked the World Bank to help us review the restructuring mechanism and make recommendations.

President Clinton has warned that no one will invest in Indonesia if Jakarta mishandles East Timor. Do you share that fear?
I hope it doesn't come to that. I don't know whether [what he said] was too dramatic, but it doesn't have to go that far.

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