Govt to request debt-swap facility at CGI meeting<\/p>\n
Evi Mariani, The Jakarta Post, Jakarta<\/p>\n
The government is seeking a debt reduction facility via a debt-
\nswap mechanism at the upcoming Consultative Group on Indonesia
\n(CGI) donors meeting.<\/p>\n
"I'm collecting information from ministries on what can be
\npossibly swapped for our (sovereign) debts," Coordinating
\nMinister for the Economy Dorodjatun Kuntjoro-Jakti told reporters
\non Tuesday.<\/p>\n
"We have already secured a debt-for-nature swap from Germany,"
\nhe said. "Now, why don't we swap debt-for-poverty or debt-for-
\nemissions?"<\/p>\n
Dorodjatun was speaking on the sidelines of a meeting with
\nother ministers and exporters to make preparations for the World
\nTrade Organization ministerial conference in September in Cancun,
\nMexico.<\/p>\n
"We will propose a debt swap to CGI and hope we can secure
\ntens of millions of dollars," he said, without explaining the
\nform of the swap or a schedule.<\/p>\n
CGI, which is a grouping of the country's traditional donors,
\nis slated to hold an annual meeting with the government in
\nOctober this year to decide on the size of a fresh loan for
\nIndonesia. The government says it still needs foreign loans to
\nhelp finance next year's state budget deficit, projected at 1
\npercent of gross domestic product.<\/p>\n
The government has been struggling hard to reduce its huge
\nforeign debts of around US$70 billion. But since the country is
\nnot categorized as a highly indebted poor country, which would
\nmake it eligible for debt relief, the only possible scheme is
\nthrough a debt-swap mechanism, experts have said.<\/p>\n
Debt swaps are usually carried out to reduce debt by using the
\nfunds borrowed for financing certain programs that are of concern
\nto the donors. As a consequence, a borrowing country does not
\nhave to repay a certain amount of the debt used for the program.<\/p>\n
In March, the government secured a debt-for-nature swap
\nfacility worth $15 million from Germany. Reportedly, the facility
\nis used for assisting water-related projects such as
\nenvironmental conservation and food security programs.<\/p>\n
The German government has long been assisting Indonesia,
\nthrough funds channeled to several non-governmental
\norganizations, in the provision of clean water and sanitation in
\npoor areas.<\/p>\n
Dorodjatun said that Indonesia was considering proposing a
\ndebt-for-emission swap facility to the donors. "Donor countries
\noften criticize Indonesia, saying it pollutes the air through
\nautomobile emission," he said. "But now, let me ask in return,
\nwhere did all the cars crowding our roads come from?"<\/p>\n
So, he said, it would only be fair if the Indonesian
\ngovernment sought a debt-for-emission swap from countries
\nproducing automobiles.<\/p>\n
However, Dorodjatun refused to comment when asked whether
\nIndonesia would request such a facility from Japan, whose giant
\nautomakers like Toyota, Mitsubishi and Suzuki dominate the
\nautomotive market in Indonesia.<\/p>\n
Japan is one of the country's largest foreign donors.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/govt-to-request-debt-swap-facility-at-cgi-meeting-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }