Govt to issue decree on SMEs's bad debts

Govt to issue decree on SMEs's bad debts

Antara, Jakarta

The government will issue a presidential decree on the
restructurization of bad debts owed by small and medium
enterprises (SMEs) by the end of June or early July, Coordinating
Minister for Economic Affairs Dorodjatun Kuntjoro Jakti said here
on Tuesday.

"The government wants to settle the issue as soon as
possible," Dorodjatun said after a cabinet session on SMEs led by
Vice President Hamzah Haz.

Dorodjatun said, of the total SMEs' bad debts of Rp 28.1
trillion (about US$3.2 billion), Rp 10.2 trillion was owed to
state-run banks, Rp 4.8 trillion to private banks, Rp 3.1
trillion to the Indonesian Bank Restructuring Agency (IBRA), and
Rp 10 trillion to the Directorate General for State Auctions and
Debts Affairs.

The issue of SMEs' bad debts is expected to be finalized
before 2004, the minister said, adding that Central Bank Governor
Syahril Sabirin and Coordinating Minister for People's Welfare
Yusuf Kalla had signed an agreement to set aside Rp 30 trillion
in funds to help SMEs.

Meanwhile, Minister of Cooperatives and Small and Medium
Enterprises Alimarwan Hanan said the presidential decree would
regulate the restructuring of the bad debts.

SMEs included in the restructurization program would be
cooperative debtors who were willing to settle their debts in
good faith, debtors with bright business prospects but who were
unable to repay the debts due to the economic crisis, and debtors
with maximum bad loans of Rp 5 billion.

The debt restructurization program would also involve IBRA,
Alimarwan said.