Malaysia promises bridging loan for RI

Malaysia promises bridging loan for RI

KUALA LUMPUR (AP): Malaysia will provide a bridging loan to help Indonesia while it waits for the rest of a US$43 billion rescue package organized by the International Monetary Fund, Prime Minister Mahathir Mohamad said yesterday.

The amount was not mentioned, but Mahathir said Malaysia could provide only part of the help needed. He said Japan also has given Indonesia financial aid.

Mahathir said the loan for Indonesia would be in addition to US$1 billion that Malaysia provided for its neighbor last year when the economic crisis began.

"Indonesia needs some help because the IMF is slow in channeling the balance of the $43 billion rescue package to Indonesia," he added.

The loan is to be repaid as soon as Indonesia receives the IMF aid, Mahathir said after meeting with Ginandjar Kartasasmita, Indonesia's coordinating minister for economy, finance and industry.

Ginandjar told reporters that President Soeharto had sent him to inform Mahathir of developments and reforms in Indonesia.

He also thanked the Malaysian government for its help in easing Indonesia's economic crisis.

In Mahathir's talks with Ginandjar, Southeast Asia's problem with haze from forest fires also was discussed, the national news agency Bernama said.

"Discussions covered contingency plans to battle the problem, especially during the forthcoming Commonwealth Games here from Sept. 11-21," Mahathir told reporters.

He said the Indonesian minister in charge of the environment would come to Malaysia to discuss the problem further with his Malaysian counterpart.

The haze and a water shortage in the Klang Valley are two problems facing organizers of the Commonwealth Games.