Government vows to honor international contracts

President Abdurrahman Wahid reasserted on Monday that the government remained committed to honoring its international business deals, but said contracts acquired through corruption in the past would have to be reviewed, The Jakarta Post reported on Tuesday.

"Whatever comes out of the regional autonomy plan, we should not break our international commitments, but we ask the companies to renegotiate their contracts because (some) contracts were acquired in the past through corruption, cronyism and nepotism," Abdurrahman told a media conference after presiding over the first of regular Monday meetings of his economics team at Bina Graha presidential office.

The President was responding to a question about the months-long tax dispute pitting gold mining company PT Newmont Minahasa Raya against a local government in North Sulawesi.

"We have to be steadfast to this principle (of honoring international contracts), otherwise we will not be respected and nobody would want to invest here," Gus Dur, as the President is also called, said.

In the wake of a demand for a review of the mining concession awarded to PT Freeport Indonesia several months ago, Abdurrahman confirmed that Indonesia would respect all international contracts it had endorsed.

Foreign investors have raised concerns about the country's volatile security climate and the uncertainty over the implementation of the new law on regional autonomy, which is expected to take effect starting from Jan. 1, 2001. (*)