International bond road show starts in Dubai: Boediono

The Jakarta Post, Jakarta

Minister of Finance Boediono said on Friday that the government would take advantage of next month's International Monetary and Finance Committee (IFMC) forum in Dubai to help market the country's planned US$400 million international bond offering.

He said that although the IFMC meeting was actually a government-to-government forum, private investors would also be present at the meeting.

"We need the two parties (governments and businesses) so as to strengthen our position," Boediono said. The meeting will take place on Sept. 21.

After Dubai, the non-deal road show is expected to continue to other major financial centers in the world such as London, Singapore and New York.

The government, as stated in its 2004 state budget draft, plans to issue international bonds next year amounting to Rp 3.48 trillion (about $400 million), as part of foreign financing to help plug the estimated Rp 24.9 trillion in budget deficit.

The government is in dire need of extra financing sources following its decision not to extend the IMF's program, which deprives the country of access to foreign debt relief from the Paris Club of creditor nations.

This financing scheme will come along with other options, including optimizing potential revenues from both domestic sources and foreign ones.

Under the budget draft, however, domestic sources still make up the largest portion in deficit financing, totaling Rp 39.8 trillion.

The bond issue will be the country's first international bond issue since the 1997 financial crisis. In 1996, the government issued some $400 million worth of Yankee bonds.

Elsewhere, Boediono also reiterated that during the expositions, Indonesia would highlight the progress it had made so far in its economic reform program

That would include also the government's reform program in the future without the IMF-supported programs.

The government is preparing a 'white paper' which contains crucial economic reform targets in the post-IMF era, which should be ready by then, he added.