Japan provides $540m in addition to CGI aid pledge

JAKARTA (JP): The Japanese government will provide new yen loans for medium and long-term assistance amounting to around 58.1 billion yen or equivalent to US$540 million on top of its 171.6 billion yen ($1.58 billion) contribution to the $4.8 billion CGI loans.

Kouji Tsuruoka, the spokesman for the Japanese Embassy in Jakarta, said on Wednesday that the additional loan would be disbursed over several years to finance five "highly prioritized and urgent projects."

"Most CGI donor countries have focused on short-term assistance. We in Japan view the Indonesian economy as departing from the crisis situation. Therefore Japan considers it necessary to promote assistance for project-type aid on a long-term perspective basis to ensure stability and promote further development in Indonesia," he told a media conference.

He said that around 8.5 billion yen, equivalent to $79 million, would be disbursed in 2001 for the five projects.

Tsuruoka said the project loans were for the Batang Hari irrigation project (7.64 billion yen), the water resource development project (18.68 billion yen), rural areas infrastructure development project (20.04 billion yen), institutional and human resources development for IT-related customs services improvement project (4.12 billion yen) and the maritime education and training improvement project (7.67 billion yen).

Tsuruoka added that the Japanese government would also provide "grant assistance and technical cooperation" next year.

He said that the amount for next year had not yet been decided, but the grant assistance and technical cooperation for the current budget year was worth around 14 billion yen ($130 million).

Tsuruoka said that Japan, the biggest donor country to Indonesia, "expressed its determination to extend as much support as possible to assist Indonesia in her reform efforts ... despite severe Japanese financial conditions."

"Furthermore, the government of Japan called on the government of Indonesia to promote economic structural reforms, to formulate poverty alleviation strategies, to promote democratic and fair and good governance, and to implement projects in an effective and transparent manner," he added.

The Consultative Group for Indonesia (CGI), meeting in Tokyo and chaired by the World Bank, pledged an expected $4.8 billion in aid for 2001 and said it would add $530 million in technical assistance grants.

The CGI comprises 21 countries and 13 institutions, including Japan, the United States, the World Bank and the Asian Development Bank. (rei)