Japan banks reject rescheduling request
Japan banks reject rescheduling request
TOKYO (Reuters): Japan's major banks have rebuffed a request by Indonesian Vice President B.J. Habibie asking them to reschedule his country's private-sector debt, banking sources said yesterday.
On the last working day of a visit to Indonesia's biggest creditor nation for talks on how Japan could help Jakarta out of its economic crisis, Habibie held talks with Japan's major commercial banks and the Export-Import Bank of Japan.
The sources said Habibie asked Japanese banks to allow Indonesian private firms to repay their debt in installments over a period of two to three years after a one-year payment freeze.
Japanese banks' outstanding loans to Indonesia totaled $23.1 billion at the end of June 1997, according to the Bank for International Settlements (BIS).
Habibie said that in Indonesia's harsh economic circumstances it would be logical to reschedule private sector debt repayments.
The sources said Japanese banks were united in rejecting the request as unacceptable.
Habibie urged the banks to have discussions with Indonesian firms that owe them money without delay, and suggested that the Asian Development Bank be asked to mediate if negotiations did not go smoothly, the sources added.
Indonesian officials accompanying Habibie or those in Jakarta were not available for comment on the meeting.
During his three days in Japan, Habibie met Japanese Prime Minister Ryutaro Hashimoto and other top Japanese leaders for talks which he described as "excellent".
There was a small demonstration when Habibie visited the Japanese parliament for talks with leading politicians.
About 50 members of the so-called Japan Non-Governmental Organization Network on Indonesia held placards demanding an end to official Japanese development aid.
Social Democratic Party (SDP) top policy-maker, Tadatoshi Akiba, who accompanied Hashimoto on a trip to Jakarta last weekend, said Indonesia must implement a 50-point economic reform which it agreed to with the International Monetary Fund (IMF) in January.
However, Seharto has been hesitant to implement some of the reforms and new talks are in progress on the issue.
Until the reform plan is settled, the IMF has postponed disbursement of $3 billion in loans to Jakarta, and Japan has also put off 20 billion yen ($180 million) in loans.
Most of Habibie's visit to Japan was spent assuring Japanese officials that Indonesia was now negotiating constructively with the IMF.
Antara meanwhile reported that Habibie expressed his hope that the Japan Indonesia Forum (JIF), which he cochairs, would continue promoting bilateral economic ties.
During a luncheon held by JIF in his honor, Habibie also gave notice of his intention to resign from his JIF post which he has held for 15 years, saying his new schedule as vice president would not permit him to hold on to the post.
The other co-chairman of JIF is Yoshiro Hayashi.
Habibie introduced his successor, the new State Minister for Research and Technology Rahardi Ramelan to take his place in JIF.
JIF now is expected to engage in education and trainings, as well as in the expansion of agricultural, and research and technology programs, he said.
"JIF is likewise expected to render technological services to businessmen engaged in agroindustry," he said.
In addition, he said JIF has to start conducting seminars in a bid to improve human resources and applied technology.
During the luncheon, Yoshiro Hayashi formally congratulated Habibie as Indonesia's vice president for the 1998-2003 term.