The World Bank is incapable to talk on Poverty!

Criticism to the Opinion of the Country Director of World Bank Indonesia, Joachim von Amsberg on Oil Subsidy in National Budget 2008

Press Release of Institute for National and Democratic Studies
No. 03/pressrelease/e/sekre.indies/III/2008

Criticism of Country Director of World Bank Indonesia, Joachim von Amsberg to the oil subsidies national budget (APBN) 2008 is a trapping sight. Fomentation for removing the oil and transfers it to infrastructure project is camouflage to force Indonesia maintains neoliberal policies. Whereas, the neoliberal policies is main caused of Indonesian misery.

As been quoted from Suara Pembaruan daily, ( 26/3), Joachim von Amsberg looks into, budget to boost up subsidy BBM in APBN 2008 going up triple than last year, will only be the benefit of a few person from solvent circle. Further, Joachim von Amsberg explains, “the budget is has to be transferred for infrastructure projects or other labor intensive permeating many labors, causing can depress unemployment number and poorness”. The explanation submitted in a discussion with theme “The Impact of Global Economy Development” in Jakarta (25/3).

As arguments of the officers of world bank before, this argument also not fully correct but clearly wrong. It doesn’t base on at reality of concrete situation of the Indonesian economics. The main mistake from Joachim von Amsberg is the assumption that subsidy as instrument eradicate the poverty. This argument not based, because in reality, where every states in the world had used the subsidy policy only to prevent the worse impact of economic destruction and poverty. The poverty itself is a result of the inescapable affect of economic growth led by the market system of capitalism.

Need to be noted that oil subsidy is only a minimum compensation schemes given government to people as citizen. This scheme actually addressed to withdraw the people demand on sovereignty over the energy and vital mineral resources like oil and gas. The subsidy itself cannot and will not remove the cause of people’s misery and loses that caused by the existence of mining activity of oil and gas done by giant corporation that been monopolizing commerce of oil and gas in the world. That’s why the proposal of removing the oil subsidy as submitted by World Bank will only prolong the un-justice on the energy sectors in Indonesia.

The facts of the today economic crisis in Indonesia and the rest of world were empirically subtle to the role of international finance and monetary institution like World Bank and IMF. The historic role of World Bank and IMF in ruling the world economic had systematically brought the poor and backward countries like Indonesia suffer in the deeper economic misery. Development aid in form of debt from World Bank and IMF and other conspecific institutes, like ADB, had become the main cause of economic destruction in the whole world. Poor and vulnerable people in Indonesia and the poor people of other countries were forced to work harder and took the lowest benefit of economic growth and development.

If the World Bank are intends to eradicate the poverty, overcomes unemployment, and creates prosperity, either in Indonesia and the world, the corrective effort that must be the first to be done is at his own role and domination in worldwide economy. World Bank must dare to take correctional steps, not only was write-off of the debt, but also giving the debt repatriation to finance the economic recovery of the backward and poor countries among the world. Instead doing that matter, World Bank is clearly doesn’t have any credibility to talk on the poverty reduction and economics recovery.

Jakarta, March 26, 2008
 

Syamsul Ardiansyah
Program Manager
Institute for National and Democratic Studies