We can handle it up to November. But the biggest problem is the negative signal the IMF gives to the business community. Both the rupiah and share prices have been hit but both markets remain very thin, limiting the actual outflow of funds. Ibra had also left corporate debt rescheduling and restructuring of the state banks on hold, he added. The recovery is very fragile, mainly based on a recovery of agriculture.
Industry has to contribute but no credits are forthcoming.
The recapitalisation of all these banks has not been completed. Moody's, the rating agency, has estimated recapitalisation will cost at least Rp732,000bn, or about Pounds 55bn. Part of this bill comes in next year, when the first batch of government bonds issued for the recapitalisation start bearing interest. The Bank Bali scandal has highlighted the abuse of a government guarantee on most bank liabilities, offered in early 1998 to halt a run on the banks. The guarantee restored depositor confidence but it lapses in January, and members of parliament oppose a renewal.