RI turns to Australia on trade problems<\/p>\n
JAKARTA (JP): President Soeharto has asked Australia to help
\nresolve Indonesia's trading problems by issuing an export credit
\nguarantee for the country because many foreign banks, including
\nAustralian ones, have rejected its Letters of Credit (L\/C).<\/p>\n
The President told visiting Australian Foreign Minister
\nAlexander Downer yesterday that such a guarantee would go a long
\nway to facilitate trading relations between the two countries.<\/p>\n
"Apparently what is needed are some covers or guarantees from
\nsome (foreign) governments that indeed (Indonesian) imports will
\nbe paid for by importers," Minister of Foreign Affairs Ali
\nAlatas said of the encounter between Soeharto and Downer in their
\n45-minute meeting.<\/p>\n
Domestic bankers and importers have complained that many
\nforeign banks have refused to accept L\/Cs issued by Indonesian
\nbanks unless they were guaranteed by foreign banks.<\/p>\n
"What we need is a kind of acknowledgement not only by the
\nprivate sector which may have some doubts but by (foreign)
\ngovernments that our trading position is strong and is
\ntrustworthy," Alatas noted.<\/p>\n
Indonesia's exports to Australia from January to July last
\nyear totaled US$732 million while its imports were about $1.3
\nbillion, according to the Central Bureau of Statistics.<\/p>\n
Alatas said that Soeharto did not ask for more financial
\nassistance from Australia but focused his discussion on corporate
\ndebt.<\/p>\n
"The President... explained to Foreign Minister Downer that
\nat the moment the main problem is how the private sector debt is
\nbeing handled... and how to keep our trade going."<\/p>\n
As of December last year, Indonesia's foreign debt stood at
\n$140 billion, $65 billion of which was owed by private sector.<\/p>\n
Downer told the President that Prime Minister John Howard and
\nhis cabinet would soon take a decision on Soeharto's request.<\/p>\n
"We are prepared to look at the possibility of providing some
\ngovernment cover for lines of credit," Downer remarked.<\/p>\n
Downer announced yesterday that Australia would place several
\nadvisors in Indonesian government agencies, including the
\nNational Development Planning Board and Bank Indonesia, the
\ncentral bank, to help develop new employment sector strategies
\nand to strengthen its banking and financial system.<\/p>\n
About the credit-line scheme, Downer said: "This is a
\ngovernment guarantee through the Export Finance Insurance
\nCorporation guaranteeing the payment to exporters by importers
\nfrom Indonesia over a particular period of time".<\/p>\n
Australia pledged a 1 billion dollar loan to the US$40 billion
\nbail-out package for Indonesia, led by the International Monetary
\nFund (IMF) to rescue the later's collapsing economy.<\/p>\n
Downer noted that Soeharto was firmly committed to the tough
\nIMF economic reform package, and he pledged Australia's full
\nsupport for him.<\/p>\n
"We are doing our best to provide support to Indonesia at this
\ndifficult time," he said.<\/p>\n
According to Alatas, Soeharto also assured Downer that
\nIndonesia's national stability was very solid.<\/p>\n
"As you can see stability is solid. There have been of course
\na few demonstrations... that is quite normal, they are
\nexpressions of people's views," Alatas said.<\/p>\n
After a separate meeting with Alatas, Downer said that his
\ngovernment would only evacuate its diplomats and citizens when a
\ncountry was in an emergency situation.<\/p>\n
"And Indonesia is no exception," Downer said when asked by
\nreporters about such a possibility in the near future. (prb)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ri-turns-to-australia-on-trade-problems-1447893297",
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"sponsor": "Okusi Associates",
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