Our foreign loans

Our foreign loans

Members of the House of Representatives have urged the
government to ask the Consultative Group for Indonesia (CGI)
consortium for loans totaling about US$6 billion. As House member
A.A. Baramuli said, if the CGI were to approve only US$5.2
billion, Indonesia would, in real terms, be getting less than
before because of inflation and increased foreign exchange rates.

At present, the government has to repay around US$5 billion
annually in interests incurred. This is quite a considerable
amount, particularly considering the current account deficit
which totals approximately US$4 billion. The installments, which
private borrowers will have to pay in both interest and
principals, are also expected to grow, as short-terms loans
mature.

We are not overly concerned about those foreign loans, either
private or government, which have now reached a total of about
US$100 billion. The loans are well managed. Nevertheless our
efforts to reduce our dependence on foreign loans needs to be
stepped up. This should be done, among other things, by
increasing the efficacy of the relevant government apparatus, so
that they will become oriented more towards achieving investor
satisfaction, be better able to activate the taxation sector and
be more creative in their efforts to mobilize domestic funds.

-- Bisnis Indonesia, Jakarta