RI urged to use loans properly

BANDUNG: The Italian government has urged Indonesia to properly use the money from its soft loan for the development of small-scale leather businesses.

After a dialog with owners of small and middle-size leather businesses, the head of Consumer Affairs Italian Trade Commission, Commercial Section at the Italian Embassy, Pratiwi Hatmosroyo, said on Tuesday the government of Italy would not hesitate to stop the loan if Indonesia failed to spend the money as specified in the Memorandum of Understanding.

Pratiwi said last May Italy agreed to loan a total of US$10 million. "Half of the amount is given in cash and the other half will be in form of machineries needed by the leather industry."

"The Italian government is now awaiting the establishment of a leather processing training center to be used by the May loan," she said, adding that the project must be completed this year.

Italy was very concerned with the use of the $5 million in soft loans dropped two years ago, she said. The money was apparently used for poverty eradication programs, instead of as agreed.

"Maybe the government of Indonesia misunderstood about the use of the loans from us, yet we stressed that the money was supposed to be for leather industry development," said Pratiwi. (25/sur)