Government speeds up foreign debt repayment<\/p>\n
JAKARTA (JP): The government will accelerate its repayment of
\nhigh-interest foreign debts with the proceeds from the recent
\ninternational public offerings of state-owned companies PT
\nTambang Timah and PT Telkom, Minister of Finance Mar'ie Muhammad
\nsaid yesterday.<\/p>\n
Mar'ie said the debts to be repaid are those owed to the World
\nBank and the Asian Development Bank (ADB) which carry interest
\nrates exceeding 10 percent per annum.<\/p>\n
\"If we don't speed up our debt repayment, the cumulative debt
\nwith interest rates over 10 percent may reach US$2.1 billion,\" he
\ntold reporters after attending a plenary session of the House of
\nRepresentatives.<\/p>\n
During yesterday's session the House approved the
\nimplementation of the state budget for the 1993\/1994 fiscal year.<\/p>\n
Mar'ie said that Tambang Timah's overseas offering in October
\nresulted in $154.72 million in revenues for the government, while
\nits domestic sales brought in Rp 140.5 billion ($61.35 million)
\nin company revenues.<\/p>\n
Meanwhile, Telkom's offering abroad resulted in $605.95
\nmillion in net earnings for the government. From domestic sales,
\nthe government obtained Rp 437.32 billion while Telkom earned Rp
\n1.85 trillion.<\/p>\n
Mar'ie said the government's total net revenues from the
\nlisting of the two firms of $760.67 million would be used to
\nrepay its debts to the ADB and the World Bank.<\/p>\n
The debts to be repaid were incurred in 1982.<\/p>\n
Presently, Indonesia's debts to the ADB which have interest
\nrates of more than 10 percent per annum total $1.11 billion,
\nwhile those to the World Bank total $264 million.<\/p>\n
Saving<\/p>\n
\"By accelerating debt repayment, we can save more than $700
\nmillion,\" Mar'ie said.<\/p>\n
He said that, apart from cutting back spending, the
\naccelerated repayment would boost Indonesia's credibility with
\nthe international community.<\/p>\n
\"This is important for the national economy. Better
\ncredibility affects both the government and the private sector...
\nHopefully this will also improve Indonesia's debt rating,\" he
\nadded.<\/p>\n
Standard & Poor's, one of the world's most influential rating
\nagencies, recently raised its long-term foreign currency rating
\nof Indonesia to triple B (BBB) from triple B minus (BBB-).<\/p>\n
Legislator Hamzah Haz, a member of the House's Budgetary
\nCommission, praised the government move, saying that any
\nsurpluses gained by the government could be used to pay back
\nforeign debts.<\/p>\n
Hamzah said he was not concerned that the debts were paid
\nusing the proceeds of the partial privatization of state firms
\nrather than with export revenues.<\/p>\n
\"What's important is the fact that we are capable of
\npenetrating the international market,\" he said. (pwn)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/government-speeds-up-foreign-debt-repayment-1447893297",
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