Canada takes RI place in Thai IMF bailout

Canada takes RI place in Thai IMF bailout

BANGKOK (Dow Jones): Canada formally took Indonesia's place yesterday as a lender in a US$17.2 billion credit line arranged for Thailand by the International Monetary Fund.

Indonesia found itself unable to meet its commitment to a $500 million contribution when its own economy collapsed after the Thai program was arranged in August last year.

Canadian Ambassador Bernard Giroux and Bank of Thailand Chatu Mongol Sonakul signed an agreement Monday at a ceremony presided over by Thai Finance Minister Tarrin Nimmanhaeminda.

The Thai credit line consists of $4 billion to come directly from the IMF, $10.5 billion from bilateral pledges, and $2.7 billion from the World Bank and the Asian Development Bank.

Tarrin said that out of the $500 million Canadian contribution, $360 million can be drawn immediately.

The remainder of the contribution will be subject to Thai government and IMF approval of an ongoing quarterly review of the program.

A letter of intent from the Thai government setting out economic targets and policies tied to the upcoming fifth quarter of the program will be considered by the IMF board in Washington on Sept. 11. An IMF team in Bangkok is to wind up talks with the Thai government on fifth quarter by Sunday, and the letter of intent may be presented to the Thai cabinet for approval next week.