Report of rescheduling rejection dismissed

JAKARTA (JP): State Minister of Research and Technology Rahardi Ramelan has denied media reports that Japanese banks rejected a request by Vice President B.J. Habibie to reschedule Indonesia's private sector overseas debts.

Rahardi, one of Indonesia's senior officials accompanying Habibie to Japan, said yesterday that Japanese banks had never expressed such a turndown in their meeting with the Vice President.

"The debt problem is still being discussed between the Indonesian private sector and Japanese lenders on a case-per-case basis," he told Antara before Habibie's team returned to Jakarta after completing a three-day visit in Tokyo.

The Japanese media reported Friday that Japan's major banks had rebuffed a request by Habibie asking them to reschedule Indonesia's private-sector debt.

During his visit to Tokyo, Habibie asked Japan's major commercial banks to allow Indonesian private firms to repay their debt in installments over a period of two to three years after a one-year payment freeze.

Japan is Indonesia's largest creditor. Outstanding loans from Japanese banks to Indonesia totaled US$23.11 billion at the end of 1997, according to the Bank for International Settlements (BIS).

Habibie said Friday that the purpose of his visit to Tokyo was to ask for Japan's support in dealing with the crisis, including addressing Indonesia's overhanging private debt issue.

He also denied reports that he had asked Japan to reschedule the government's debt, pointing out that it consisted of soft and long-term loans and that the government should not have any problems repaying it.

He added, however, that the private debt issue must be quickly solved.

Habibie's visit to Tokyo was his first overseas trip after being recently elected as vice president. (08)