Govt mulls increasing global bond plan<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Minister of Finance Boediono said on Friday that the government
\nmay increase the size of its international bond issue next year
\nfrom the original plan of US$400 million following an upgrade in
\nthe country's sovereign rating.<\/p>\n
He said that the rating upgrade would help reduce the cost of
\nthe bond issue.<\/p>\n
\"The rating upgrade will affect the size of the bond plan,\"
\nBoediono told reporters.<\/p>\n
He declined to provide details as his office was still
\ndiscussing the plan. Some officials, however, have previously
\nsaid that the issue could be increased to around $600 million.<\/p>\n
International rating agency Fitch Ratings on Thursday upgraded
\nthe country's sovereign rating to B+ from B with a stable
\noutlook, citing improving economic stability. Although the
\ncountry's rating remains below investment grade, the move should
\nbe seen as a vote of confidence in the economy.<\/p>\n
Boediono was hopeful that the country's rating would continue
\nto rise in the coming months if the economy continues to improve
\nand no significant negative development occurs.<\/p>\n
\"We must maintain the current positive development (in the
\neconomy),\" he said.<\/p>\n
The government has planned to issue international bonds in the
\nfirst quarter of next year to help finance the state budget. It
\nwill be the government's first bond issue in the international
\nmarket since the late 1990s financial crisis.<\/p>\n
During international road shows in Singapore and Hong Kong
\nearlier this week, institutional investors suggested the
\ngovernment raise the bond issue up to $1 billion.<\/p>\n
Officials from the Ministry of Finance and Bank Indonesia met
\nalso with international rating agencies during the road show.<\/p>\n
Meanwhile, Bank Indonesia Governor Burhanuddin Abdullah said
\nthe rating upgrade would cut the interest spread of the bond
\nissue, thus lowering the burden on the state.<\/p>\n
\"This is an encouraging development. Hopefully, there will be
\nanother upgrade in December,\" he said.<\/p>",
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