RI expects US$5.3b in new loans from CGI

JAKARTA (JP): Indonesia expects US$5.3 billion in new foreign loans this year from the Consultative Group on Indonesia (CGI) despite a possible reduction in aid from Japan, a senior minister said.

Coordinating Minister for Economy and Finance, Saleh Afiff, said after a meeting with President Soeharto yesterday that Indonesia expected the CGI, which will hold its annual meeting in Tokyo early next week, to give at least the same amount as last year.

The CGI committed $5.26 billion in new loans and grants last year, compared to $5.358 billion the year before.

Afiff, Bank Indonesia Governor Soedradjad Djiwandono and economic adviser to the government, Widjojo Nitisastro, reported to the President on their preparation for the CGI meeting.

Afiff said that Japan -- CGI's largest creditor -- was facing financial problems which had forced it reduce its foreign aid.

Japan's foreign aid to Indonesia through the CGI was $1.917 billion last year or 36 percent of the total, as compared to $2.14 billion or 40 percent of the total in the previous year.

Other big donors under the CGI are the World Bank ($1.2 billion or 23 percent) and Asian Development Bank ($1.2 billion or 23 percent).

Affif also referred to the dollar's appreciation against the Japanese yen. Last year the dollar stood at 88 yen, but it now hovers at 114 yen.

"If Japan's loan this year is maintained at last year's amount of 206.5 billion yen, it will then reach only $1.811 billion in dollar terms, down by $106 million from last year," Afiff said.

The CGI groups the U.S., Australia, Austria, Belgium, Denmark, Finland, Britain, Italy, Japan, Germany, Canada, South Korea, Norway, France, New Zealand, Spain, Switzerland and Sweden.

Also included in the CGI are the World Bank, Asian Development Bank, International Monetary Fund, Overseas Economic and Cooperation Development, European Union, United Nations International Children's Fund, International Fund for Agricultural Development, International Finance Corporation, Islamic Development Bank, Saudi Fund, Kuwait Fund, Nordic Investment Bank and European Investment Bank. (bnt)