RI's foreign aid likely to exceed original target

RI's foreign aid likely to exceed original target

JAKARTA (JP): New grants and loans accrued by the government
from foreign creditors for development projects will likely
exceed the original target of Rp 10.01 trillion (US$4.57 billion)
due to the appreciation of the Japanese yen against the rupiah, a
minister says.

"Details of the realization of the offshore aid are now being
calculated but it will most likely go higher than our target,"
State Minister of National Development Planning Ginandjar
Kartasasmita, told a hearing with the Budgetary Commission of the
House of Representatives (DPR) yesterday.

For this 1994/1995 fiscal year, Indonesia has received aid
commitments of $5.2 billion from the Consultative Group for
Indonesia's (CGI), including $1.67 billion from Japan.

Ginandjar, who is also chairman of the National Development
Planning Board (Bappenas), assured the Budgetary Commission that
the government will be able to repay its offshore loans, most of
which have been accrued with concessional terms offering low
interest rates with long-term maturity.

Ginandjar did not reveal the government's total foreign debt,
but Minister of Finance Mar'ie Muhammad last month disclosed that
the country's offshore borrowing reached $89 billion as of June,
including $59.46 billion owed by the government and $29.5 billion
by the private sector. Over 40 percent of the government's total
debts are denominated in yen and the rest in other currencies.

Ginandjar said that the government will not depend much on
offshore loans. "In the future, we plan to gradually reduce
reliance on offshore loans," he said.

Next year

In spite of the country's efforts to curb its loan reliance,
the government, under its Sixth Five Year Development Plan
(Repelita VI), expects to obtain Rp 11.35 trillion in foreign aid
next fiscal year.

"The aid planned for next fiscal year will be used mostly to
develop human resources, infrastructures in rural areas and less-
developed provinces, management, as well as improve industrial
production and promote poverty alleviation in the less-developed
regions," Ginandjar said.

He told reporters during a break in yesterday's hearing that
CGI creditor members are expected to meet the government's demand
for new aid next year because it has thus far performed well in
debt repayments. (fhp)