Indonesia may get lower loan support from CGI: Ginandjar
JAKARTA (JP): Indonesia may not be able to get a large enough loan commitment this year from the Consultative Group on Indonesia (CGI) to finance the state budget for the next fiscal year, Coordinating Minister for Economy, Finance and Industry Ginandjar Kartasasmita said here on Friday.
Ginandjar said the donors grouped in the CGI, particularly the World Bank and the Asian Development Bank, had nearly reached the limit of allowable exposure to any one country.
"It will be tough to get the same amount as last year. But it doesn't mean it is impossible... Economic diplomacy is very important," Ginandjar said, adding that the country still needed massive amounts of international financial aid to repair its economy.
Indonesia received some US$7.9 billion in loan commitments from the CGI in July 1998.
Ginandjar said the July 26 to July 27 meeting with the CGI would go forward as planned despite calls to delay the meeting until a new administration was formed in November.
"All CGI members have agreed to proceed as planned," he said.
He said the upcoming CGI meeting would only result in loan commitments from major multilateral and bilateral donors, while the details of the loans would have to be worked out by the next administration.
Indonesia held a landmark general election on June 7, and a presidential election is scheduled for November during the General Session of the newly formed People's Consultative Assembly.
Provisional election results show the Indonesian Democratic Party of Struggle (PDI Perjuangan) led by popular opposition figure Megawati Soekarnoputri with a commanding lead.
Ginandjar said that prior to making any loan commitments, CGI members would first discuss specific topics with the government.
"In the past, the topics included human rights and East Timor," he said, referring to the former Portuguese colony which was annexed by Indonesia in 1976.
"But I think East Timor will no longer be an issue," he said.
The United Nations is organizing a direct ballot on August 8 to allow the East Timorese to decide whether the province will remain a part of Indonesia with wide-ranging autonomy or separate from Indonesia.
Ginandjar also said the troubled province of Aceh would not be among the topics discussed.
Political unrest has escalated in the gas-rich Aceh over the past several months as separatist guerrillas have intensified their demands for independence.
"We are still deciding on the topics. We have met with people from the Asian Development Bank and we'll be meeting with the World Bank at the end of this month.
"The important thing is to ensure a smooth transition of (political) power," he said.
Ginandjar also declined to disclose how much the government would request from CGI.
"We're still discussing it. First we have to check our balance of payments and the estimated need for the (next) budget," he said, adding that the government has not yet calculated the cost of the bank restructuring program and other expenses or the projected state revenue.(rei)