Moody's lowers Indonesian rating

Moody's lowers Indonesian rating

HONG KONG (Dow Jones): Moody's Investors Service has changed the
outlook for Indonesia's B3 foreign currency country ceiling and
Caa1 foreign currency bank deposit ceiling to stable from
positive.

Moody's said Tuesday that a number of indicators showed an
improving economic performance during 2000. Economic growth, at
4.8 percent, was a substantial increase from the depressed levels
recorded previously.

The fiscal deficit came in under the originally projected
level. Furthermore, the external accounts performed relatively
favorably.

Nevertheless, Moody's believes that the political problems
facing Indonesia and their effect on economic management and on
the relationship with official creditors indicate that it is
unlikely that the rating agency would upgrade Indonesia's ratings
in coming months.

While external liquidity is adequate, it could deteriorate if
relations with official creditors do not improve. Furthermore,
the country's very high level of public sector debt in relation
to GDP means that there is little room for policy slippage.

As a result of these factors, a stable outlook for the ratings
is more appropriate at this time, it added.

Moody's also said it changed the rating outlook to stable from
positive on Sampoerna International Finance Co BV's senior
unsecured notes, guaranteed by PT Hanjaya Mandala Sampoerna.

It said the change in outlook reflects its decision to change
the outlook for Indonesia's B3 foreign currency country ceiling
and Caa1 foreign currency bank deposit ceiling to stable from
positive.

PT Hanjaya Mandala Sampoerna, headquartered in Surabaya,
Indonesia, is a leading cigarette company that manufactures and
markets the premium kretek brands in the country.

Sampoerna International Finance Co BV, is a finance subsidiary
of Sampoerna.