RI to sell overseas bonds in 2005 in several phases
RI to sell overseas bonds in 2005 in several phases
Shanthy Nambiar and Wahyudi Soeriaatmadja, Bloomberg/Jakarta
Indonesia may sell bonds overseas next year in several phases
as part the government's plan to raise as much as US$1.5 billion
abroad, an official said. It plans to meet potential investors
after mid-January.
"We should issue it gradually, in amounts that wouldn't prompt
us to have to raise the yields," from current levels,
Coordinating Minister for the Economy Aburizal Bakrie said on
Thursday in Jakarta.
The government is considering selling between $1 billion and
$1.5 billion of debt, Mulia Nasution, director general of
Treasury at the Finance Ministry, said on Nov. 8. Indonesia may
also sell bonds that comply with Islam's ban on paying interest
for the first time next year as part of this proposal, Finance
Minister Anwar Jusuf's said yesterday.
Indonesia's $208 billion economy is forecast by the government
to expand 5 percent this year and 5.5 percent next year. Higher
growth and improved credit ratings may help lure overseas
investors. The nation's credit rating was raised one level to B+
by Standard & Poor's today because of the "declining debt and
debt-servicing burden" and increased stability in Southeast
Asia's largest economy.
The 2014 dollar-denominated bond yielded 6.78 percent at 12:44
p.m. in Jakarta, falling from 6.82 percent yesterday, according
to Deutsche Bank AG prices. The risk premium, or extra yield
borrowers pay relative to U.S. Treasuries, was 2.6 percentage
points, down from as high as 4.52 points on June 3.
Indonesian officials, including Bakrie and Anwar, plan to
travel overseas, including Europe, to gauge investor demand for
the bonds after mid-January, Bakrie said. Earlier, Indonesia said
it plans to meet with banks and investors in Singapore, Hong
Kong, London and New York.
Indonesia sold $1 billion of 10-year bonds in March, its
largest overseas debt sale, drawing demand for more than eight
times the amount offered. JPMorgan Chase & Co. and Deutsche Bank
AG helped manage the sale.