Report of rescheduling rejection dismissed

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)