Japan, Australia offer help to RI

Japan, Australia offer help to RI

JAKARTA (JP): Minister/State Secretary Moerdiono confirmed yesterday that Japanese Prime Minister Ryutaro Hashimoto had offered Indonesia financial assistance within a bilateral framework to help restore confidence in the economy, especially the rupiah.

"Mr. Hashimoto made the offer during a telephone conversation with President Soeharto earlier today," Moerdiono said.

Moerdiono said that Hashimoto, like the leaders of other countries who had met with Soeharto recently, fully shared the President's view that Indonesia's basic problem was to restore domestic and international confidence in its economy.

Moerdiono said the conversation was initiated by Hashimoto, but he declined to mention the amount of standby loans offered by the Japanese leader.

Nonetheless, banking sources here estimated the loan offer to be at least US$5 billion.

On Monday, Malaysian Deputy Prime Minister and Minister of Finance Anwar Ibrahim called on President Soeharto and offered a standby loan of $1 billion from his government.

On Tuesday, Soeharto said Singaporean Prime Minister Goh Chok Tong, who met with him in Jakarta Oct. 21, pledged $10 billion in standby loans to help Indonesia regain market confidence.

According to Moerdiono, visiting Australian Prime Minister John Howard, who met with President Soeharto yesterday, also offered assistance for the same purpose.

Howard said at a news conference yesterday that "our offer was conditional upon IMF conditions being met, and any contribution that we make... would be supervised by the IMF".

Asked whether President Soeharto was happy with the offer, Howard said: "Well, he certainly didn't object."

AFP also reported that Hashimoto telephoned President Soeharto from Tokyo yesterday to offer financial aid as part of an IMF rescue package.

Hashimoto said he had a long conversation with Soeharto. "I told him that we would assist Indonesia and the IMF in working out a (reform) program soon," he said.

"Japan for its part is ready to provide funds... on the condition that Indonesia accepts the IMF-supported program," AFP quoted Hashimoto as saying.

The Japanese premier said the focus of the market had shifted from the Thai baht, whose July 2 float triggered Asian-wide currency turmoil, to the Indonesian rupiah.

"We have to settle these problems one by one -- this is very important," Hashimoto said. "Without stabilizing Asian currencies, the current confusion in financial markets will not end."

Joining the telephone conversation were Japan's Director General of International Finance Haruhiko Kuroda and Director General of Economic Cooperation Kenzo Oshima.

A spokesperson for the Monetary Authority of Singapore said the amount Singapore was to provide Indonesia to rebuild investor confidence was still being worked out.

The amount of financial assistance "was still under consideration," the spokesperson was quoted by the Business Times as saying yesterday.

The Business Times said Soeharto's announcement, which underscored Singapore's position as a major strategic partner of Indonesia, would complicate Jakarta's ties with multilateral institutions.

Soeharto said Tuesday that Jakarta was not seeking financial aid, but technical advice and assistance from the IMF to review reform programs the Indonesian government had prepared to cope with the currency crisis. (prb/vin)