Soeharto wants comprehensive debt solution<\/p>\n
JAKARTA (JP): President Soeharto called over the weekend for
\na comprehensive and final solution for dealing with the crippling
\ndebt of developing countries.<\/p>\n
Speaking at the opening of a three-day ministerial meeting of the
\nNon-Aligned Movement (NAM), Soeharto said that many developing
\ncountries are still facing major debt burdens even though the
\ninternational community has had the opportunity to build a more
\npeaceful, prosperous and equitable world order.<\/p>\n
Soeharto, NAM's current chairman, said that the positive
\ndevelopment made in international politics and East-West
\nrelationship have not been followed by commensurable efforts in
\nthe economic field, or by efforts to improve the North-South
\nrelationship.<\/p>\n
At present, the world economy is bound by a new and veiled
\nform of protection, low commodity prices, declining flow of
\nfunds, insufficient technological access and heavy debt
\nservicing, he told the meeting which was attended by senior
\nofficials of 31 least developed countries, mostly from Africa. It
\nwas also attended by representatives of international financial
\ninstitutions.<\/p>\n
The meeting, which is scheduled to end today, will hear the
\nIndonesia's experience in reorganizing its foreign debt and in
\nmanaging its economy.<\/p>\n
It will also discuss the recommendations of the Movement's ad
\nhoc advisory group on debts, changes in the international debt
\npolicy and on the 70 percent reduction in the debt burden of
\nleast developed nations.<\/p>\n
Soeharto's economic advisors -- Widjojo Nitisastro, Ali
\nWardhana, Radius Prawiro, Suhadi Mangkusuwondo and Emil Salim --
\nare among the speakers.<\/p>\n
Persuade<\/p>\n
As the NAM chairman, Soeharto has taken various steps to
\npersuade the Group of Seven (G-7) industrialized nations to adopt
\nan appropriate approach in dealing with trade, investment and
\nstrategy for debt solution.<\/p>\n
\"The initiative of the Non-Aligned Movement to take a
\nconstructive approach in solving common problems has had a
\npositive response from the G-7, as reflected by the Tokyo Summit
\nEconomic Declaration,\" he said.<\/p>\n
Soeharto said that before the Summit of the G-7 was held in
\nNaples, Italy last July, he had also reminded the G-7 about the
\ndebt issue. \"As a result, the G-7 declared that they are inclined
\nto reduce the debt stock and increase the concessions to
\ncountries suffering from specific difficulties.<\/p>\n
Indonesia, which has foreign loans of around US$90 billion, has been
\nwidely recognized for its success in managing its huge debts.<\/p>\n
Indonesia, as a country that once had a bitter experience as a
\ndebtor nation, is keen on sharing its experience with other NAM members,
\nSoeharto told the meeting, also attended by a representative of the UN
\nSecretary General.<\/p>\n
\"We hope that our experience in solving the debt problem can
\ncontribute to the process of finding a comprehensive and
\npermanent solution to the debt problems of developing countries,\"
\nSoeharto added.<\/p>\n
NAM, during its summit meeting here in September 1992, set up
\nan advisory group of experts to accommodate the concern about the
\ncrippling debt problem raised by the Movement's leaders in the
\nsummit.<\/p>\n
The group, headed by Gamani Corea of Sri Lanka, has
\nrecommended a number of approaches for dealing with the debt
\ncrisis facing the least developed nations.<\/p>\n
Debt reduction<\/p>\n
The advisory group, in its report presented by its chairman
\nduring the opening of the meeting, called for a reduction of debt
\nof low and lower-middle income heavily indebted nations by 70
\npercent on the average.<\/p>\n
Corea said that the debt reduction would have to be applied to
\nall three major classes of creditors; bilateral official
\ncreditors, private sector lenders and multilateral creditors.<\/p>\n
He said that the severe difficulties that many developing countries
\nfaced in servicing their debt resulted in the persistent accumulation of
\narrears. Despite repeated scheduling, many developing countries have not
\nbeen able to meet debt service obligation fully and on time for several
\nyears.<\/p>\n
In 1992, there were at least 58 heavily indebted countries, of which
\n32 were classified as least developed countries. The actual arrears of
\nthe 32 countries were much larger than the 20 percent threshold:
\n91 percent were in arrears exceeding 50 percent of the loans,
\nhalf had arrears exceeding 86.7 percent, and 39 percent had
\narrears in excess of 90 percent.<\/p>\n
Corea said that the total long term debt of those countries in
\n1992 amounted to US$247.6 billion, 26 percent of which was owed
\nto multilateral financial institutions, 49 percent to governments
\nand their agencies and 24 percent to the private creditors.<\/p>\n
Of the 58 countries in 1992, 35 had a level of per capita income
\nranging from $60 to $650.<\/p>\n
\"Their income levels worsened over time as many experienced
\nnegative growth,\" Corea said.(hen)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/soeharto-wants-comprehensive-debt-solution-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}