Govt to set new trade finance

Govt to set new trade finance

JAKARTA (JP): The government will introduce a new trade
finance scheme to help exporters import raw materials and export
their products.

Director General of International Trade Djoko Moeljono said
here yesterday that the new scheme would complement the current
scheme, in which the government guarantees Indonesian firms'
letters of credit.

Djoko said the utilization of the current government's
guarantee scheme was below par as only 16 companies used the
facility, with a total guaranteed fund of US$136 million -- out
of $1 billion placed by Bank Indonesia at 10 foreign banks.

He noted that the current scheme was not effective as local
banks did not have confidence in importers' ability to settle
their dues owing to the sharp depreciation of the rupiah against
the U.S. dollar.

The director general, however, refused to explain the details
of the new scheme and only said the new scheme would be announced
soon. (rid)