IMF inks final loan to Indonesia

IMF inks final loan to Indonesia

Agencies, Jakarta

The International Monetary Fund (IMF) approved on Friday a US$505
million loan to Indonesia, the final portion of the $5.3 billion
support program devised after the 1997-1998 Asian economic
crisis.

Although Jakarta decided not to ask the international lender
for a new support program, the country will enter into the IMF's
"post-program-monitoring" scheme, under which it will continue to
check economic conditions and advise on policy if necessary.

"An impressive fiscal consolidation and disinflation effort,
together with reduced external vulnerability, have laid the basis
for a sustained improvement in growth and employment prospects in
the period ahead," IMF deputy managing director Shigemitsu
Sugisaki said in a statement quoted by Dow Jones news wire.

The IMF also expressed optimism about the nation's efforts to
continue economic reform.

"Satisfactory progress continues to be made with key
structural reforms. The divestment of government ownership in
banks is proceeding well.... It will be important to sustain
these reform efforts and, in particular to follow up decisively
on the recent steps," Sugisaki said.

IMF's Indonesia mission chief Daniel Citrin was reported by
Agence France-Presse as saying the economy has stabilized thanks
to the government's efforts to restore macroeconomic stability.

The country has already announced its post-IMF reform strategy
-- praised by Sugisaki as a "sound framework". The World Bank
says Indonesia must raise about $10 billion in 2004 to refinance
its debts.