International Monetary Fund's statement on RI economic program<\/p>\n
WASHINGTON (Reuters): The following statement was issued on
\nWednesday by Alassane Ouattara, a deputy managing director at the
\nIMF, on Indonesia's economic program:<\/p>\n
I am pleased to announce that in support of the Indonesian
\ngovernment's economic program, the IMF's executive board today
\napproved the completion of a review of Indonesia's stand-by
\ncredit.<\/p>\n
The board also approved an increase in the financing under the
\n36-month stand-by credit by SDR 1 billion (about US$1.3 billion),
\nto SDR 8.3 billion (about US$11 billion).<\/p>\n
Following the completion of the review, SDR 734 million (about
\nUS$1 billion), is available to Indonesia immediately, bringing
\ntotal IMF disbursements under the credit to SDR 3.7 billion
\n(about US$4.9 billion).<\/p>\n
The full amount of the additional financing approved today is
\nto be made available before end-March 1999, in addition to the
\nIMF resources already committed for the period.\"<\/p>\n
New financing for the program is also to be provided through
\nan informal arrangement among bilateral creditors that involves
\nthe rescheduling of principal payments falling due or the
\nprovision of an equivalent amount of new money. Additional
\nfinancing will also be made available by Australia, China, the
\nAsian Development Bank and the World Bank.<\/p>\n
The total additional financing for the program, including the
\nincrease in the IMF stand-by credit, amounts to over US$6
\nbillion, all of which is to be provided before end-March 1999.<\/p>\n
This comes on top of substantial external financing previously
\ncommitted by multilateral institutions, and by Japan and other
\nbilateral donors.<\/p>\n
In completing the review, executive directors commended the
\nauthorities for good policy implementation in very difficult
\ncircumstances. They welcomed the economic priorities set by the
\ngovernment to prevent a further economic decline, reduce
\ninflation, and to substantially intensify its efforts to protect
\nthe poor from the worst effects of the crisis.<\/p>\n
In this connection, strengthening of the distribution system
\nwas an urgent priority. Directors also agreed that a much higher
\nbudget deficit was necessary to accommodate higher subsidies on
\nessential items and other social spending.<\/p>\n
Continued firm control over monetary policy and rapid
\nimplementation of the reforms under way in the banking system and
\ncorporate restructuring were also viewed as policy priorities.<\/p>",
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"sponsor": "Okusi Associates",
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