Kwik says govt seeks refinance, reschedule for foreign debt

JAKARTA (JP): The government is seeking to refinance and reschedule its foreign debt but will not ask for any debt relief, according to Coordinating Minister for Economy, Finance and Industry Kwik Kian Gie.

Kwik said on Monday that the government was "exploring all possible options" to manage its external debt, including through new financing and rescheduling within existing international rules.

"No debt reductions are being sought. Consistent with the polices of the new government, discussions with external creditors will be conducted in a transparent manner," Kwik said in a media statement.

Kwik explained that the government was putting together a comprehensive economic policy package in consultation with the international financial institutions to deal with the current economic situation and support sustained recovery.

An International Monetary Fund technical team is in Jakarta and is discussing the country's economic programs with government officials.

Indonesia's overseas debts total more than US$150 billion, of which more than $75 billion is sovereign debt.

The government is seeking to reschedule up to $6 billion in overseas debt maturing in the next two fiscal years with Paris Club creditor nations.

Several leading Indonesian non-governmental organizations recently insisted creditor institutions provide the country with debt relief on the grounds that much of the debts had been subject to corruption by the previous government of former president Soeharto.

But the World Bank has said that Indonesia is not eligible to any debt relief because the country had not fallen into the ranks of poor nations.

Reports also claim that the Japanese government will not provide any debt relief to Indonesia because Japanese law prohibits such a measure.

President Abdurrahman Wahid is visiting Tokyo to meet with Japan's top officials. Abdurrahman will be in Tokyo until Thursday.(rei)