RI to seek $22.5b from CGI

JAKARTA (JP): The government will propose 686 development projects worth around US$22.5 billion during the meeting of the World Bank-chaired Consultative Group on Indonesia (CGI) in Paris later this month.

Deputy Chairman of the National Development Planning Board Rahardi Ramelan said yesterday that the government plans to ask for about $17.68 billion in soft loans and grants from the CGI donor members to partly finance the proposed projects.

But he acknowledged that the government is not likely get new aid commitments as large as the total sum to be proposed.

He told a press briefing on the government's proposals in the fourth meeting of the CGI that the proposed projects are contained in the government's 1995 Blue Book, which lists development projects expected to be financed partly by the donors.

CGI's donor members may choose one or more projects listed in the Blue Book to finance.

"The Blue Book describes our priority development projects and CGI's members may select only those which meet their requirements," he said.

He added that the projects not taken up by the donors would be proposed again in the next annual meeting of the creditor group.

He refused to disclose the government's actual estimate of the CGI's aid commitment for 1995-1996 but said that new aid commitments are expected to be as large as the US$5.2 billion pledged last year.

"We are still doing the calculation," Rahardi said.

The World Bank suggested in its 1995 Report on Indonesian economy, which will be discussed at the forthcoming meeting, that CGI's aid commitments for 1995-1996 be at least as large as last year.

But if the CGI members fail to meet Indonesia's minimum target, the government would seek other financing alternatives, Rahardi added.

Rahardi said that the government would, for example, seek export credits to finance important projects, which are not accepted by the CGI members.

The 1995 Blue Book was issued late last month, much earlier than in the previous years when copies of the book were distributed to the donors' representatives in Jakarta just a few days before the CGI meeting.

"We hope the CGI members will have adequate time to assess the projects they would like to finance," he said.

The government proposed 660 projects worth around $23.46 billion to the CGI meeting last year but the donor group pledged only around $5.2 billion, less than one-third of the required funds.

Around $12.6 billion or around 56 percent of the total aid proposed in the 1995 Blue Book will be allocated for the construction of infrastructure and economic facilities and $4.9 billion or around 22 percent for human resources development.

Rahardi added that $5.59 billion or around 24.8 percent of the total would be earmarked for the energy and mining sector, $4.02 billion or around 17.8 percent for transportation, geophysics and meteorology sectors and the remaining $2.28 billion or around 10.1 percent for educational, sports and youth activities.

According to Bank Indonesia (the central bank), the government's outstanding external debts totaled $64 billion as of April.

About 71.4 percent of the total debts are categorized as concessional loans, carrying annual interest rates of less than 3.5 percent per annum and a repayment period of up to 25 years. Another 25.7 percent are semi-commercial loans and the remaining three percent are commercial loans.

According to the central bank's records, the foreign debts owed by the private sector total about $30 billion. (hen)