ADB pledges strong support for RI
ADB pledges strong support for RI
JAKARTA (JP) : Asian Development Bank president Tadao Chino
reiterated the bank's strong commitment to support the government
in implementing economic reform program.
Chino made the statement Wednesday during a meeting with
President Megawati Soekarnoputri.
"Indonesia faces many challenges but I am confident that under
the leadership of President Megawati more hopeful times lie
ahead," he said in a statement.
ADB is one of Indonesia's largest donors together with the
World Bank and Japan.
The government has planned to meet with the country's
traditional donors grouped in the so-called Consultative Group on
Indonesia (CGI) in November to seek loan to help finance the 2002
state budget. Last year, the grouping pledged some US$4.8
billion in loan to help plug the current 2001 budget deficit.
On ADB's loan commitment to Indonesia, Chino said that the
bank would maintain its lending level for the country at between
$600 million-$1.2 billion per year.
"How much we lend will depend on the country's needs as well
as its capacity to effectively absorb our assistance," said Chino
in his first visit since Megawati assumed power in July.
ADB said earlier this year that Indonesia could obtain a high
case lending scenario if it managed to secure a deal with the
International Monetary Fund, and showed strong commitment to
continue reform program including curbing corruption and
improving good governance.
The IMF approved Tuesday the government's new letter of intent
(LoI), clearing the way for the disbursement of the Fund's $395
million loan tranche to the country. The IMF money is expected
to improve the confidence of investors and creditors in the
country including ADB and the World Bank.
The Fund suspended its loan program to the country late last
year amid signs that the previous government was dragging its
feet in implementing agreed reform agenda.
Chino said that the nature and pace of the ongoing reforms
will determine the extent of ADB assistance to the country.
Earlier on Tuesday, Chairman of the Investment Coordinating
Board Theo Toemion announced a set of policy investment
initiative as a precondition for the release of the ADB
assistance.
The policy initiative includes measures to improve the
investment climate in the country and launching a new investment
law.
Chino said that ADB was willing to work closely with the
government in combating corruption, improving governance and
promoting decentralization.
ADB assistance has been aimed at reducing poverty and regional
disparities by strengthening Indonesia's institutions, promoting
private sector development, supporting initiatives in less
developed areas, investing in human and social development and
strengthening environmental management.
The two leaders also discussed the ongoing process of
decentralization, which is expected to play a significant role in
improving governance and providing public services more
efficiently and effectively in Indonesia.
Ongoing ADB assistance to Indonesia includes a loan to support
the country's decentralization program.
ADB also supports projects to decentralize health services
delivery and strengthen local government capacity to manage
coastal resources.(11)