Finance team seeks overhaul of reform deal

Indonesia's new economics team wants to 'significantly' review the terms of its reform deal with the International Monetary Fund to take into account the country's changed political and economic dynamics.

IMF Asia-Pacific director Hubert Neiss is due to arrive in Jakarta on Tuesday to discuss the new government's priorities.

He will also review progress made in investigating an alleged financial scandal at Bank Bali before recommending any resumption in stalled international lending.

After being sworn in as Economic Co-ordinating Minister, Kwik Kian Gie said his government was committed to implementing IMF-mandated structural reforms as quickly as possible, including bank recapitalisation, and had no immediate plans to resume a fixed exchange rate.

His team needed, however, 'to review significantly the agreement, because the conditions of economic dynamics and political dynamics have changed', he said.

Trimegah Securities research head David Chang said: 'Oil prices have increased, interest rates have come done and Indonesia now has a stronger currency, so they have now got more room to change.' On taking office last week, new President Abdurrahman Wahid promised he would make economic recovery one of his two top priorities.