Govt wants over $4.1b from CGI

JAKARTA (JP): The government is likely to ask for more than US$4.1 billion from donor countries grouped under the Consultative Group on Indonesia (CGI) for the next budget year, citing increasing overseas debt repayments falling due next year.

State Minister for National Development Planning Kwik Kian Gie said on Tuesday that the government could not afford to ask for just $4.1 billion in loans as it had done at last year's CGI meeting.

"We can't. Back then the wave of foreign debt repayments had reached its lowest point. But now we can't," Kwik told reporters after a meeting of economics ministers.

He declined to say how much the government would ask for.

Last year, the CGI pledged $4.1 billion in loans and another $500 million in grants to Indonesia.

Data from Bank Indonesia shows that the government plans to repay $7.3 billion in foreign debt this year. Another $4.4 billion in short term debts fall due by April of next year.

The government hopes that the Paris Club of creditor nations at its meeting in September will agree to reschedule $2.8 billion of the Indonesian foreign debt that falls due this year.

Kwik was also upbeat that the donor countries would accept the loan proposal the government was preparing for them.

"This time I can say our success at the CGI meeting will be 100 percent, meaning that what we need for our 2002 state budget will be provided by the CGI," he asserted.

He said he had become optimistic during his talks with local representatives of the CGI donor countries.

Their mood, he said, had improved following Indonesia's success in restoring its ties with the International Monetary Fund (IMF).

On Monday, the government signed the latest Letter of Intent (LoI) to the IMF, signaling to donor countries that Indonesia's economy was on the right track.

The next CGI meeting will be held in November, by which time the government hopes to have completed the drafting of the 2002 state budget.

The success of this meeting also depends on the government's ability to present a convincing budget to donor countries.(bkm)