Conference on debt begins<\/p>\n
JAKARTA (JP): Approximately 1,200 participants representing
\nmostly local debtors and foreign creditors attended the Jakarta
\nInitiative conference, which opened on Monday to restart stalled
\nnegotiations on massive corporate debts.<\/p>\n
Coordinating Minister for Economy, Finance and Industry
\nGinandjar Kartasasmita, who opened the two-day gathering,
\nreaffirmed the importance of the corporate debt restructuring for
\nthe recovery of the crisis-hit economy.<\/p>\n
\"We will not be able to generate the jobs we need, alleviate
\npoverty, expand our national output or generate fiscal balance
\nuntil the engine of growth in our economy, its private sector, is
\nworking again. This means that the companies which employ our
\npeople, provide our exports and invest for our future have to be
\nput on a sound long-term financial footing,\" he said.<\/p>\n
He said that proper and accurate information must be shared
\nbetween debtors and creditors to reach a restructuring agreement.<\/p>\n
\"When they work with asymmetric information, it can undermine
\nthe trust that is needed for agreements to be reached,\" he added.<\/p>\n
Finance Minister Bambang Subianto also stressed in his speech
\nthe need for transparency on the part of local debtors.<\/p>\n
He said the government had abolished regulatory hurdles and
\nprovided incentives to promote corporate restructuring.<\/p>\n
The Jakarta Initiative corporate restructuring program was
\nlaunched last month to encourage debtors and creditors to meet at
\nthe negotiation table to hammer out an out-of-court debt
\nsettlement.<\/p>\n
The country's private sector overseas debt as of April this
\nyear amounted to US$67 billion, including $4 billion in the form
\nof securities and derivatives. Of the total, $32 billion is due
\nthis year.<\/p>\n
The Jakarta Initiative also promotes an out-of-court
\nsettlement for the more than Rp 600 trillion in debts owed by the
\ncorporate sector to domestic commercial banks.<\/p>\n
The Jakarta Initiative Task Force chairman, Jusuf Anwar, said
\nthe large participation in the conference indicated a positive
\nattitude both on the part of the creditors and debtors to solve
\nthe debt problem through corporate restructuring.<\/p>\n
He said the number of participants was three times more than
\nthe original target.<\/p>\n
He said 35 percent of the conference participants represented
\nforeign creditors, 35 percent represented local debtors and the
\nremainder represented local bankers, lawyers, auditors,
\nrestructuring consultants and government officials.<\/p>\n
However, head of the World Bank's corporate restructuring and
\ngovernance group, Gerald Meyerman, warned people not to expect
\ntoo much too soon from the conference.<\/p>\n
\"Everyone needs to recognize that this is a very complex
\nprocess. The Jakarta Initiative conference represents an
\nimportant first step but it's unrealistic to expect large-scale
\nresults on restructuring until the first quarter of 1999,\" he
\nsaid.<\/p>\n
But he added, \"With so many participants registered, it is
\nvery clear that all of us have made an impressive start.\"<\/p>\n
Conference speakers included chairman of the country's private
\ndebt team, Radius Prawiro; World Bank country director in
\nJakarta, Dennis de Tray; the Lippo Group's deputy chairman, James
\nRiady; the Indonesian Chamber of Commerce chairman, Aburizal
\nBakrie; the National Private Banks Association chairman, Gunarni
\nSoeworo; John Knight of Chase Manhattan Bank; Wolfgang Topp of
\nDeutsche Bank; Nitin Bajtai of Morgan Stanley Dean Witter; and
\nVictor Khoslal of Cerberus Capital Management.<\/p>\n
The second-day meeting on Tuesday will discuss, in closed-door
\nsessions, sectoral developments and will hopefully see early
\nstarts in individual talks between debtors and creditors. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/conference-on-debt-begins-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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