Japan agrees to reschedule RI's $2.8b sovereign debt<\/p>\n
JAKARTA (JP): The Japanese government finally signed a formal
\nagreement with the government of Indonesia on Friday to
\nreschedule the latter's US$2.8 billion sovereign debt maturing
\nbetween 2000 and 2002.<\/p>\n
The agreement was signed here by the Director General for
\nForeign Economic Relations of the Ministry of Foreign Affairs
\nMakarim Wibisono and the Japanese Ambassador in Indonesia Yukio
\nTakeuchi.<\/p>\n
The debt will be rescheduled into 15-20 years, but the country
\nmust start making installment by 2004.<\/p>\n
The debt rescheduling is part of the agreement reached by the
\ngovernment in April 2000 with the Paris Club of creditor nations
\nto reschedule Indonesia's $5.8 billion sovereign debt.<\/p>\n
Under the Paris Club mechanism, the government must further
\nnegotiate with individual creditor nations over details of the
\nrescheduling.<\/p>\n
The government has been trying to reach a final deal with the
\nJapanese government, the country's largest creditor, for about a
\nyear.<\/p>\n
Masaya Fujiwara, counselor of economic and development of the
\nJapanese Embassy, said that around 50 percent of the debt or $1.4
\nbillion matured between April 2000 and March 2001, and the other
\nhalf matured in April 2001-March 2002.<\/p>\n
He said that the rescheduling of the $1.4 billion debt
\nmaturing in April 2001-March 2002 would only be implemented if
\nIndonesia reached a new economic agreement with the International
\nMonetary Fund (IMF).<\/p>\n
\"It will also be executed if the Indonesian government reach
\nan agreement with the IMF,\" he said, adding he was optimistic
\nthat Indonesian government and IMF would reach a deal.<\/p>\n
Relations between the government and IMF turned ugly after the
\nlatter delayed the disbursement of its next loan tranche to the
\ncountry late last year amid signs that Indonesia was wavering
\nwith the implementation of agreed economic reform program.<\/p>\n
The worsening relations with the IMF had raised concern that
\nthe government might fail to obtain the debt rescheduling
\nfacility from the Paris Club, which is crucial to the
\nsurvivability of the 2001 state budget.<\/p>\n
But new Coordinating Minister for the Economy Burhanuddin
\nAbdullah expressed optimism earlier this week that the IMF would
\nfinally send its review mission to Jakarta sometime next month to
\nmake a new agreement, which would pave the way for the
\ndisbursement of the IMF loan.<\/p>\n
Takeuchi said that the rescheduling demonstrated a strong
\nsupport from the Japanese government to help Indonesia focus on
\nits economic reforms.<\/p>\n
\"We would like to see the Indonesian economy get back in the
\nright track and then grow continuously,\" he told reporters after
\nthe signing ceremony.<\/p>\n
Meanwhile, Makarim said that the Japan's loan rescheduling
\nwould enable the government to maximize government revenue for
\nthe country's development.<\/p>\n
\"It is very helpful for the country as the debt maturities are
\ndelayed between 15 and 20 years,\" he said.<\/p>\n
Finance Ministry officials have earlier expressed optimism
\nthat other Paris Club members would also finally sign a debt
\nrescheduling agreement with Indonesia. (05)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/japan-agrees-to-reschedule-ris-28b-sovereign-debt-1447893297",
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