New IMF accord expected to be signed this week<\/p>\n
JAKARTA (JP): A new letter of intent between Indonesia and the
\nInternational Monetary Fund (IMF) is expected to be signed this
\nweek, Coordinating Minister of Economy, Finance and Industry
\nGinandjar Kartasasmita said yesterday.<\/p>\n
He said the agreement would allow for the quick disbursement
\nof the IMF's additional bailout money for Indonesia, which was
\ndelayed following last month's political unrest.<\/p>\n
IMF deputy managing director Stanley Fischer said earlier in
\nBrazil that the loan disbursement to Indonesia could resume on
\nJuly 6.<\/p>\n
The IMF has pledged to provide US$10 billion to Indonesia in a
\nbalance of payments loan, which is part of a $43 billion bailout
\npledged by multilateral agencies and government donors last
\nNovember.<\/p>\n
The IMF has disbursed $4 billion to date, and is planning to
\ndisburse another $1 billion next month after a team headed by IMF
\nAsia-Pacific director Hubert Neiss completes reviewing the
\ncountry's economic reform programs.<\/p>\n
The disbursement of the IMF loan will be key to the unlocking
\nof overseas aid and to the revival of market confidence in the
\neconomy, which has been mired in its worst economic crisis in
\nthree decades.<\/p>\n
Ginandjar said the government would not opt to reschedule its
\nforeign debts if other options were available, including the help
\nof international institutions.<\/p>\n
Many economists have suggested Indonesia consider rescheduling
\nthe repayment and servicing of its $54 billion in sovereign debts
\namid the government's severe liquidity crisis. But others say
\nthat such a decision would further diminish international
\nconfidence in the government.<\/p>\n
"We realize that without international help our stabilization
\nprogram will not succeed," Ginandjar said. "I have assurances
\nfrom the United States that they will help Indonesia overcome its
\nproblems."<\/p>\n
He was speaking after a meeting with U.S. Deputy Treasury
\nSecretary Lawrence Summers, who made a one-day visit to Jakarta
\nyesterday.<\/p>\n
A central bank official said the Consultative Group on
\nIndonesia (CGI), which is scheduled to convene next month, was
\nexpected to agree to the country's proposal to use its aid to
\nfinance social safety net programs.<\/p>\n
CGI aid has been traditionally used to finance infrastructure
\nprojects.<\/p>\n
Neiss and the government are currently discussing ways to
\nfinance the 1998\/1999 state budget, which is being heavily
\nburdened by various subsidy commitments. (rei)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-imf-accord-expected-to-be-signed-this-week-1447893297",
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"sponsor": "Okusi Associates",
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