Reforestation funds remain in SBIs

JAKARTA (JP): The Ministry of Forestry would unload its Rp 1.2 trillion (US$333 billion) in reforestation funds placed in Bank Indonesia Certificates (SBIs) only if President Soeharto orders to do so, the ministry's secretary-general said yesterday.

Oetomo said the ministry would continue to roll over its SBIs at maturity to help the monetary authority keep liquidity in check.

"The reforestation funds will remain in SBIs -- we'll wait for orders from the President directly or through the state secretary," Oetomo said at his office.

He added that even the minister of forestry could not disburse the funds from Bank Indonesia, but the central bank could release the funds with the minister's approval.

SBIs are short-term, rupiah-denominated obligations issued by the central bank to drain excess liquidity from the market.

Minister of Forestry Djamaludin Suryohadikusumo said early September that his ministry had deposited at least Rp 1.2 trillion of reforestation funds in SBIs in August to help the falling rupiah.

He said reforestation funds collected by the ministry from forestry companies totaled about Rp 2 trillion.

Before being deposited in SBIs, most of the funds were kept in the country's seven state-owned banks, including Bank Rakyat Indonesia, Bank Bumi Daya, Bank Tabungan Negara, Bank Pembangunan Indonesia, Bank Negara Indonesia, Bank Dagang Negara and Bank Ekspor Impor Indonesia.

Oetomo said the ministry would prefer to withdraw the funds than keep them in SBIs.

"If we could choose, we would rather keep the funds in other banks, because they offer higher rates. But we keep them in SBIs for the country's sake," he said.

The rates for SBI papers are 14 percent for one-day SBIs, 15 percent for two-day to six-day SBIs, 16 percent for one-week SBIs, 20 percent for one-month SBIs, 19 percent for two-month SBIs and 18 percent for three-month SBIs. (08)