Govt focuses on bilateral talks to settle foreign debts<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The government will have to rely on bilateral talks with
\nindividual creditor nations to reschedule the country's huge
\nforeign debts after it graduates from the International Monetary
\nFund (IMF) at the end of the year.<\/p>\n
\"With the absence of the IMF economic program, we can no
\nlonger ask for debt relief through the Paris Club or the London
\nClub.<\/p>\n
\"I think diplomacy has to be exercised. Indonesia has never
\nmissed any payments since 1950 and I intend to keep it that way
\nin dealing with our debts,\" Coordinating Minister for the Economy
\nDorodjatun Kuntjoro-Jakti said on Tuesday as reported by Antara.<\/p>\n
Under the auspices of the IMF, the government has successfully
\nasked for debt rescheduling facilities from foreign creditors,
\nboth governments and private lenders. While the Paris Club groups
\nforeign creditor nations, the London Club groups foreign private
\nlenders.<\/p>\n
The talks with the Paris Club and the London Club are seen as
\na crucial part of efforts by the government to keep the country's
\nhuge foreign debts, standing at more than US$70 billion, at a
\nmore manageable level.<\/p>\n
With its massive pressure on the country's fiscal balance,
\ndebt rescheduling schemes are a decisive way to lead the country
\nout of the debt trap.<\/p>\n
However, with Indonesia expected to end a four-year long loan
\nprogram with the IMF, the Paris Club or London Club facilities
\nwill no longer be possible as foreign countries and international
\nfinancial institutions always make their assessments on the
\ncountry's economy based on the IMF's evaluations.<\/p>\n
Indonesia's debts to the IMF total US$13 billion, with only
\nabout $3 billion repaid. There is still about $2 billion of the
\nIMF's loan commitment that has yet to be disbursed.<\/p>\n
Elsewhere, Dorodjatun said that the government was drawing up
\nan exit strategy from the IMF program. A team has been tasked to
\nformulate economic policies that are expected to replace various
\neconomic reform programs that the government has carried out with
\nthe fund.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-focuses-on-bilateral-talks-to-settle-foreign-debts-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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