BEI disappointed by lack of government's support

JAKARTA (JP): Bank Export Indonesia has complained about a lack of government support in transforming the bank into an independent export credit agency.

The president of the state bank, Bambang Hendrajatin, said on Friday the drafting of the law which would allow the bank to operate as an independent export credit agency had been completed, but it had not yet been presented to the House of Representatives for approval.

"The drafting of the law has been completed but we do not know when the law will be approved," he told Antara news agency during a break in a seminar on banking.

He believes the delay in submitting the draft law to the House was due to the busy schedule of the finance minister.

BEI was established as a export credit financing agency in August 1999, when most of the country's commercial banks were suffering from financial difficulties and unable to provide financing for export activities.

The bank is, however, not allowed to raise funds from the public and must channel its lending through existing commercial banks.

Bambang said if the new law was approved, BEI would be able to carry out its financing activities with greater independence, especially in the extension of export credits.

Since its establishment, BEI, which operates on borrowed capital of US$1 billion from the Japan Bank for International Cooperation and paid-up capital of Rp 3 trillion from the government, has provided rupiah-denominated loans worth Rp 4 trillion and credits in foreign currency of $25.5 million.

"By enjoying a sovereign status, lending costs could be lowered," he said.

BEI has so far channeled its credits through 11 state and private commercial banks.

A total of 338 exporters, 53 percent large companies and 47 percent small and medium enterprises, have benefited from the bank's financing services.

The export commodities funded by BEI comprise timber and plywood (35.27 percent), CPO (14.71 percent), shoes (14.13 percent), textiles (8.6 percent), natural rubber (6.94 percent) and electronics (5.97 percent). The rest were frozen fish, pulp and paper, chemicals and ceramics. (hen)