Govt to curb new foreign loans<\/p>\n
JAKARTA (JP): The government will continue to curb new foreign
\nborrowings to prevent the total foreign debts outstanding, as a
\npercentage of the country's gross domestic product, from
\nincreasing beyond 52 percent at present, a minister says.<\/p>\n
"We instead plan to gradually reduce the ratio of our total
\nforeign debts against our GDP to 46 percent by 1999," said
\nMinister of National Development Planning, Ginandjar
\nKartasasmita, in a hearing with the Budgetary Commission of the
\nHouse of Representatives yesterday.<\/p>\n
Ginandjar said that even though the country's foreign debts
\nwould continue to increase in absolute terms, their ratio against
\nthe GDP would not rise from its current level.<\/p>\n
"During the current Sixth Five Year Plan (1994-1999) the
\ngovernment will also see to it that the debt service ratio
\nagainst export earnings decreases to 28.2 percent," he added.<\/p>\n
Of the 28.2 percent, he said, 20.6 percentage points will
\nconsist of government debt service and the other 7.6 percentage
\npoints of private debt service.<\/p>\n
Indonesia's debt service ratio at present stands at
\napproximately 30 percent.<\/p>\n
Ginandjar did not mention the total amount of foreign debts
\noutstanding at present but official figures recently put it at
\nUS$93 billion as of last September.<\/p>\n
The government has acknowledged that the total foreign debts
\nmight reach the $100 billion mark this year.<\/p>\n
Senior economist Sumitro Djojohadikusumo even estimated last
\nDecember that the country's total foreign debts would increase to
\n$110 billion in 1998.<\/p>\n
According to Minister of Finance Mar'ie Muhammad, $56.66
\nbillion of the foreign debts were owed by the government and the
\nremaining $36 billion by the private sector.<\/p>\n
Ginandjar was optimistic that concerted efforts to promote
\nexports would result in a reduction of the debt service ratio.<\/p>\n
"We expect to expand our exports by 16.8 percent a year during
\nthe next five years," he added.<\/p>\n
Ginandjar said the government would also do its best to check
\nthe current account deficit at two percent of the GDP. (fhp)<\/p>",
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