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Statement by Indonesia to the Twenty-Eighth Session of the IFAD Governing Council

Statement by the Indonesian Governor to IFAD's Twenty-Eighth Session of the Governing Council

Mr. Chairman,
Distinguished Delegates,
Ladies and Gentlemen,

It is a great honour and privilege for me to speak on behalf of the Government of Indonesia, to express our sincere appreciation and thanks to the President of IFAD and his staffs for convening this important meeting so that we, the representatives of member countries, could exchange views on how to advance the work of IFAD to achieve its mission to enable the rural poor to overcome poverty.

Our heartfelt appreciation also goes to the people and the Government of Italy for their generosity and hospitality.

In this opportunity, we would like to extend our warm welcome to the Republic of Kiribati on the accession of IFAD membership. Our delegation looks forward to working closely with the delegation and the Government of Kiribati.

Distinguished Delegates,
Ladies and Gentlemen,

We meet at a time when several countries, mostly in the South Asia, have just suffered from the earthquake and tsunami disaster. Beside the human losses, the calamity leads to great economic and social impacts in the affected region by increasing the number of poor and reversing the result of rural development. Among the most adversely affected is our country, Indonesia. Our great concern is to overcome these setbacks and get rural development back on track to eradicate poverty.

Our Government's immediate action in overcoming the burden of the people in the affected areas is not only the vital short term efforts to provide relief and minimize human suffering but also the longer term rehabilitation and reconstruction process. We are fully committed to implement three phases of measures: emergency relief, rehabilitation and reconstruction, as well as prevention and mitigation, as agreed by the leaders at the Conference of the Special ASEAN Leader's Meeting on the aftermath of Earthquake and Tsunami which was held in Jakarta on January 6, 2005.

To reach those objectives, we need the global solidarity and cooperation to produce concrete efforts. Aid commitments from international community are certainly very heartening and welcome to meet the tremendous demands for reconstruction. In this regard, IFAD's immediate action for affected coastal areas and IFAD's new mechanism for long-term poverty eradication in tsunami-affected regions, such as expanding microfinance initiative the Rural Income Generating Project (RIGP) to help the victims in Indonesia, is very valuable. On behalf of the people and the Government of Indonesia, we would like to reaffirm our sincere appreciation to the overwhelming attention, response, great solidarity of the international community for the human losses and devastation.

Distinguished Delegates,
Ladies and Gentlemen,

Let me now turn to agricultural development policy in my country. Indonesia considers agriculture as the backbone of its economy. Since most of the poor are dependent on agriculture for their living, then agricultural development plays an important role in poverty alleviation. It is also true that the very persistence of such poverty, amidst a world of abundant, greatly heightens the perception in many developing countries that they are largely shut out and marginalized from the benefits of globalization.

In our new Government, two main goals of agricultural development policy are to: (i) increase agricultural productivity to guarantee regular supplies of food; and (ii) stabilize agricultural markets at reasonable prices to ensure that farmers have a better standard of living.

To reach those objectives, the Government focuses its efforts in transforming the comparative advantage into strongly competitive advantage of domestic resources to increase the local benefit. In this regard, empowering farmers and rural communities by opening and widening their access to financial resources for the development of agricultural sector, is a priority.

We would like to take this opportunity to briefly depict the progress of the previous project financed by IFAD. IFAD has helped Indonesia since 1980 by extending 12 loans worth of USD253.6 million, including two currently financed projects, namely the Rural Income Generating Project (RIGP) and the Post Crisis Program for Participatory Integrated Development in Rain Field Areas (PIDRA), worth of USD65.7 million. Beside that, two other projects are coming soon. The East Kalimantan Local Community Empowerment Program is in the process of negotiation between Central and Local Government on its implementation. While the Rural Empowerment and Agricultural Development Program in Central Sulawesi is still in the process of negotiation with IFAD.

Distinguished Delegates,
Ladies and Gentlemen,

The Government of Indonesia realizes the importance of member countries' support to achieve IFAD's objectives. For the Sixth Replenishment, Indonesia has already paid its first installment in amount of USD1.5 million in 2004 from the total commitment of USD 5 million. It is expected that the rest will be paid off as scheduled in 2005 and 2006. We would, therefore, like to appeal to all member countries to renew their commitments to IFAD. Beside that, we would also like to appeal to the management to focus its use of fund only for activities or programs that directly contribute to the achievement of IFAD's goals as mentioned by its article of agreement.


Distinguished Delegates,
Ladies and Gentlemen,

The Government of Indonesia extend full support for the partnership and collaboration between IFAD and other institutions, both multilateral and bilateral levels, to work together through the International Year of Micro-Credit 2005 to bring sustainable financial services to poor people. We believe that such partnership will strengthen IFAD to reach its goal, especially in achieving Millennium Development Goals (MDGs). This partnership can be focused on raising awareness about the important role of micro-finance in eradicating poverty and in developing rural areas.

In conclusion, the Indonesian Delegation hopes that the 28th Session of the Governing Council will gain fruitful success in its deliberations in view of the important contribution of IFAD to help developing and transition countries. We believe that the cooperation between Indonesia and IFAD will not end at this particular moment but rather it will continue in the future.

Thank you very much for your attention.
Head of Delegation of the Republic of Indonesia