ID :
65676
Sat, 06/13/2009 - 23:03
Auther :
Shortlink :
https://www.oananews.org//node/65676
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FINANCE MINISTER : RI VICTIM OF INT'L RATING AGENCIES
Jakarta, June 13 (ANTARA) - Finance Minister Sri Mulyani said Indonesia had been a victim of international rating agencies that were unwilling to understand the country's conditions so that the interest rates on Indonesian debentures continued to be high.
"We have been rated by many rating agencies but our rating remains low while Europe whose economic conditions are worse is rated higher. Why do European countries get Triple A ratings while we conntinue to recive low ratings. Is it because we do not speak English," the minister said before participants of the 7th Bank Indonesia International Seminar here on Saturday.
She said due to their wrong perceptions Indonesia had been considered risky and therefore had to pay higher interest every time it issued debt security in the market.
This has made it difficult for the country to issue global debt security because payment of its interest could later burden the budget.
She said the interest of the country's global debt security now stood at between 10 and 12 percent which was considered too high by some observers.
She said rating agencies had continued seeing Indonesia like it was during the New Order era which was considered not transparent. The fact is, she said, Indonesia had already changed. Even details of its budget could be accessed through her ministry's website.
Mulyani said she had given all the information needed to the agencies but still they kept finding faults with the country.
"When she with the S&P they asked about our budget and we had explained all about it. But then they asked about regional budgets. So they seemed to continue to perceive us as being not transparent. May be ten years ago we were not transparent but now we are more open, audited by many agencies. We have been judged by wrong perceptions," she said.
Mulyani challenged all rating agencies to come and see Indonesia by themselves.
She said the rating agencies had so far been unfair. Although the impact of their rating was real they bore no consequences when they made mistakes referring to the case of AAA ratings on intitutions like Lehman Brothers that finally went banckrupt. "They bore no consequences over the mistake," she said.
Group 30 chairman Jacob A Frenkel shared her view saying that economic decisions could not be relied upon their ratings anymore.
He said there should be a reform with regard to ratings. "Ratings are still needed for measurement but the rating system needs to be improved," he said.
Rating agency Moody's Investor Service has raised its outlook to Ba3 on Indonesia from stable to positive. It has also raised its rating on the country's foreign currency bank deposit ceilings to B1 from stable to positive. Its rating on the country's foreign currency country ceilings remained Ba2 or stable outlook.
The Indonesian government predicts the country's economy would grow 4.0 to 4.5 percent while IMF predicts at three to four. Indonesia is one of the three countries in the world that has recorded positive growth besides India and China.
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"We have been rated by many rating agencies but our rating remains low while Europe whose economic conditions are worse is rated higher. Why do European countries get Triple A ratings while we conntinue to recive low ratings. Is it because we do not speak English," the minister said before participants of the 7th Bank Indonesia International Seminar here on Saturday.
She said due to their wrong perceptions Indonesia had been considered risky and therefore had to pay higher interest every time it issued debt security in the market.
This has made it difficult for the country to issue global debt security because payment of its interest could later burden the budget.
She said the interest of the country's global debt security now stood at between 10 and 12 percent which was considered too high by some observers.
She said rating agencies had continued seeing Indonesia like it was during the New Order era which was considered not transparent. The fact is, she said, Indonesia had already changed. Even details of its budget could be accessed through her ministry's website.
Mulyani said she had given all the information needed to the agencies but still they kept finding faults with the country.
"When she with the S&P they asked about our budget and we had explained all about it. But then they asked about regional budgets. So they seemed to continue to perceive us as being not transparent. May be ten years ago we were not transparent but now we are more open, audited by many agencies. We have been judged by wrong perceptions," she said.
Mulyani challenged all rating agencies to come and see Indonesia by themselves.
She said the rating agencies had so far been unfair. Although the impact of their rating was real they bore no consequences when they made mistakes referring to the case of AAA ratings on intitutions like Lehman Brothers that finally went banckrupt. "They bore no consequences over the mistake," she said.
Group 30 chairman Jacob A Frenkel shared her view saying that economic decisions could not be relied upon their ratings anymore.
He said there should be a reform with regard to ratings. "Ratings are still needed for measurement but the rating system needs to be improved," he said.
Rating agency Moody's Investor Service has raised its outlook to Ba3 on Indonesia from stable to positive. It has also raised its rating on the country's foreign currency bank deposit ceilings to B1 from stable to positive. Its rating on the country's foreign currency country ceilings remained Ba2 or stable outlook.
The Indonesian government predicts the country's economy would grow 4.0 to 4.5 percent while IMF predicts at three to four. Indonesia is one of the three countries in the world that has recorded positive growth besides India and China.
***2***
