Indonesia next aid target: Exim Bank

Indonesia next aid target: Exim Bank

BANGKOK (Dow Jones): The president of the Export-Import Bank of the U.S. said yesterday he saw no reason why the U.S. government agency shouldn't help out ailing Indonesian companies "when we've worked out the mechanics."

James Harmon ended a two-week tour of Asia in Bangkok Friday by signing a US$1 billion package to help support U.S. exports to Thailand and said the bank would now point its sights on Indonesia.

"Even with all the problems in Indonesia (a support package) could be done in a creditworthy manner," Harmon told a news conference.

"I think the government of Indonesia on a sovereign basis and in the short term would be creditworthy," he added.

The Exim Bank provides loans, guarantees and other support to overseas countries that want to buy U.S. exports.

Harmon said the bank had announced a $1 billion package in May to guarantee short-term loans to Indonesian importers of U.S. raw materials for re-export but that the deal had fallen through after the change of government in Jakarta.

The package announced for Thailand Friday would also guarantee $1 billion in loans of up to a year to Thai importers who find it hard to raise credit in the private sector in the current economic climate.

Harmon signaled that the ExIm Bank could extend its short-term loan guarantees to the crisis-hit East Asian region in the near future.

He added that a package announced in June to extend loan guarantees to South Korean companies from $1 billion to $3 billion "could be finalized in the next week".

"There's a lot of pain (in Asia). We want to do everything we can to be helpful. We want to be supportive to Asia in difficult times," Harmon said, adding that this was the first time in years the region had turned to credit export agencies to back short- term loans.

Thailand was the last stop in Harmon's tour of Asia to help promote demand for U.S exports, which has dried up since the bursting of the region's economic bubble a year ago.