Massacres perpetrated and condoned by the Indonesian army have led to calls to halt World Bank and IMF aid programmes to Indonesia. The massacres began after a referendum in East Timor resulted in a landslide vote for independence from Indonesia. The government has placed East Timor under martial law but appears unwilling or perhaps unable to bring the army under control.
1996 Nobel peace prize winner Jose Ramos-Horta has called on the UN Secretary General to “use all his moral authority” to persuade the World Bank and the IMF to freeze funds for Indonesia. If the violence continues, the funding issue is likely to cause major controversy at the Bank-Fund annual meetings in late September.
Meanwhile, the Fund and Bank have both said they will send missions to East Timor to assess its economic situation and needs.