Japan increases Indonesian aid to some US$1.67b
JAKARTA (JP): Japan, one of the biggest creditor members of the Consultative Group for Indonesia (CGI), increased its aid commitment to Indonesia, yesterday, to US$1.67 billion this fiscal year from $1.44 billion last fiscal year.
"The new aid, which shows an increase of $230 million, reflects our government's commitment to maintaining friendly bilateral relations with Indonesia," a deputy to the Japanese Ambassador to Indonesia, Minister Zenji Kaminaga, told reporters here yesterday.
Kaminaga had a meeting with reporters at the embassy immediately after the CGI closed its two-day third meeting in Paris yesterday.
Kaminaga said the Japanese aid, which was pledged under the World Bank-chaired CGI scheme, consisted of $1.5 billion in soft loans provided by the Overseas Economic Cooperation Fund (OECF) and $170 million in grants and technical assistance by the Japan International Cooperation Agency (JICA).
He said that out of the OECF's $1.5 billion loans, $200 million will be distributed for sector loans to finance Indonesian rural infrastructure development and another $200 million in fast-disbursing assistance aimed at tackling the country's current account deficit.
He said the World Bank puts Indonesia's current account deficit at $3.6 billion this fiscal year, as compared to the $3.19 billion predicted by the Indonesian government.
According to Kaminaga, the fast-disbursing assistance, which dropped from $300 million last year, is also aimed at financing small scale projects on education, health, social welfare, human resettlement, communication and water resources.
Kaminaga said that OECF's loans under the Overseas Development Assistance (ODA) scheme focus on the improvement of infrastructure and human resource development.
Projects
Japan's project loans would be extended for 20 projects throughout the country, Kaminaga said.
The projects include water transmission construction in Ujungpandang, South Sulawesi, small scale irrigation management projects in West and East Nusa Tenggara, South Sulawesi and Lampung, the construction of hydro-power plants in the Toba Lake of North Sumatra and Aceh, and the construction of a steam coal- fired power plant in Banjarmasin, South Kalimantan.
In the transport and telecommunication sectors, the OECF's aid will cover the construction of the south-west arch road linking Grogol and the Soekarno-Hatta International Airport in Jakarta, double-track railway from Cikampek to Cirebon, development of the Bali airport, an area traffic control (ATC) system in Jakarta, extension and improvement of telecommunication networks in the greater Jakarta area and telecommunication maintenance centers throughout the country.
Kaminaga also said that, in terms of the environment, OECF has expanded its aid for sewage development in Denpasar.
He said the terms of repayment for the OECF's loans are the same as last year's, carrying an interest rate of 2.6 percent per year with a maturity of 30 years and a grace period of 10 years.
Kaminaga also said that JICA's $170 million grant and technical assistance are expected to develop Indonesian human resources and to meet basic human needs, "in keeping with our government's commitment to doing its utmost to assist Indonesia's poverty alleviation program."
In addition to CGI's aid, Japan's Export-Import Bank will also continue to expand its untied direct loans to Indonesia in efforts to help finance various projects in the country, he said. (fhp)