Lee criticizes Indonesia's response to crisis

Lee, a former prime minister and Singapore's undisputed authority figure, said late Saturday the worst of the currency crisis won't be over until the Indonesian elections in March, Singapore state-controlled TV reported.

Speaking at a local community event, Lee said Suharto's decision to carry out the proposals of the International Monetary Fund was not enough to stabilize the Indonesian currency and stock market.

Lee put the blame on "the political factor'' which he said was crucial in this crisis of confidence.

The "market was disturbed by (Suharto's) criteria for the vice president,'' said the senior minister, known for his outspokenness in an otherwise tight-lipped political culture.

Indonesia, the world's fourth most populous country, has been worst hit by the financial and economic turmoil that has swept the region since last July. The crisis also has increased social and ethnic tensions in the multi-ethnic country of 200 million.

Suharto, who has governed Indonesia for 32 years, is almost certain to be elected to a seventh five-year presidential term when a special 1,000-member assembly votes in March.

A former general with an autocratic style, Suharto has not yet named a vice presidential running mate, who might eventually succeed him. But after he recently said his deputy should have knowledge of science and technology, speculations turned to the technology minister Bacharuddin Jusuf Habibie, known for his expensive, high-tech projects.

The possibility of Habibie one day succeeding 76-year-old Suharto sent Indonesia's currency to a new low last month against the U.S. dollar. Since then rupiah has recovered some of its value, moving from 16,500 to the dollar to about 11,000 against the dollar, after Suharto gave new pledges to the IMF about his economic recovery program.

"If the country is uncomfortable with whoever is eventual vice president, the (Indonesian currency) rupiah would weaken again,'' said Lee.

He added it was vital for the rupiah to stabilize, otherwise the fallout would be bad for Indonesia and may again spread panic throughout the region.

Editor's note: On Jan 24 Mr Lee's press secretary has wrote to the Indonesian Observer denying that Me Lee had criticised President Suharto

Early last year Mr Lee made disparaging remarks on crime in the southern Malaysian state of Johor in an affidavit. He stated that Johor was a place famous for shootings, muggings and car-jackings. Those remarks led to strained ties between Malaysia and Singapore . Lee subsequently apologised and retracted the statement.

In October last year Mr Lee made comments that upset the Thai government.