International donors support fuel price scrap
Tuesday, January 21 2003 - 05:50 AM WIB
The decision by the government is ?very understandable?, World Bank country representative Andrew Seer told reporters before the opening of a two-day meeting of the Consultative Group on Indonesia (CGI) in Yogyakarta on Tuesday.
The World Bank is coordinating the annual meting of 21 bilateral donors and seven multilateral donors.
Meanwhile, International Monetary Fund Asia-Pacific senior adviser Daniel Citrin said: ?The decision by the government is understandable given that oil prices are temporarily very high.?
The government is under pressure from international lenders including the IMF to cut its huge fuel subsidy bill and its budget deficit. Supporters of the subsidy cuts say they are wasteful and mainly benefit wealthier Indonesians.
On Monday, the government reduced steep price rises, which had been imposed in the new year for fuel.
The government also cut the price of electricity on the same day. It had earlier shelfed an increase in telephone charges.
On January 2, the government raised fuel prices by up to 22 percent following on an increase in electricity and telephone surcharges by as much as 15 percent the day before.
The move incited weeks of nationwide street protests. (*)