ADB approves $484,000 grant for RI

Bloomberg Jakarta

The Asian Development Bank (ADB) approved a US$484,000 technical assistance grant to help the government reduce poverty by improving services for the poor, including health care and education.

The aid will go to support five of the poorest regional governments -- a province, a city and three districts -- the bank said in an e-mailed statement. The government will provide $214,000 for the project, which will be completed in early 2004.

"Many regional governments have inadequate resources to accelerate development, particularly in rural areas, and to continue government efforts to reduce poverty," said Shiladitya Chatterjee, the bank's chief programs coordination specialist in Jakarta.

Indonesia needs external aid to spur economic growth and help finance a budget deficit estimated at Rp 34.4 trillion (about $3.9 billion) this year. Jakarta estimates growth of 4 percent this year.

A United Nations report last year said more than half of Indonesia's 212 million people are below the poverty lines, living on less than $2 a day.

With an estimated 40 million of its citizens jobless, economic growth is key to reducing poverty and maintaining social stability in the world's fourth-most populous country.

ADB will disburse $800 million to the country this year for budget financing and to fund poverty reduction projects. The donor lent $994 million last year.