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Truth or dare? Jokowi vows to collect elusive Rp 110 trillion in debt

Endy Bayuni (The Jakarta Post)
Premium
Jakarta
Mon, April 19, 2021

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Truth or dare? Jokowi vows to collect elusive Rp 110 trillion in debt Syafruddin Arsyad Temenggung, former chairman of the Indonesian Bank Restructuring Agency (IBRA), and his lawyer Yusril Ihza Mahendra (left), leave the Corruption Eradication Commission (KPK) building after a questioning session in this photo file. (Antara/Hafidz Mubarak A.)

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his list looks like a debt collector’s dream team: Coordinating Political, Legal and Security Affairs Minister Mahfud MD, Coordinating Economic Minister Airlangga Hartarto, Coordinating Maritime Affairs and Investment Minister Luhut Pandjaitan, Finance Minister Sri Mulyani Indrawati, Attorney General ST Burhanuddin and National Police chief Gen. Listyo Sigit Prabowo.

They are part of a task force set up by President “Jokowi” Widodo this month to collect outstanding payments from borrowers of the Bank Indonesia liquidity support (BLBI) loan facility, which was offered to ailing banks during the 1998 Asian financial crisis.

While some have paid back their loan, 48 borrowers still owe the government Rp 110 trillion ($7.8 billion). Now, 23 years later, the government has decided to collect the money, by force if necessary, by repossessing the assets the debtors had pledged at the time as collateral.

Could an all-powerful debt collector team do the job when other means have been tried before and failed for more two decades? How is this going to be any different from past efforts?

The real difference, and the key to a successful campaign, is that now there seems to be a greater political will to go after these politically connected debtors — or at least to make them pay. And with the government highly pressed for money to cover its mounting deficit, there is greater urgency.

Two successive presidents — Susilo Bambang Yudhoyono in 2004-2014 and Jokowi since 2014 — tried to repossess the money by claiming there had been an element of corruption in the way the loans had been disbursed in 1998, and later in 2004 when the Indonesian Bank Restructuring Agency (BPPN) cleared the debtors of further obligations to repay.

The case was referred to the Corruption Eradication Commission (KPK), which has struggled to find evidence of corruption. In 2018, KPK appeared to be making progress when the Jakarta Corruption Court found BPPN chief Syafruddin Temenggung guilty of clearing the debts of tycoon Sjamsul Nursalim, who received nearly Rp 4.6 trillion in liquidity credit. The verdict, and the 15-year prison term, would have paved the way for the KPK to go after Sjamsul and other debtors.

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