Settlement of external debts through the UN recommended

Settlement of external debts through the UN recommended

JAKARTA (JP): Settlement of developing countries'
external debts should be integrated with the programs of
international institutions under the United Nations (UN), high-
ranking officials said here yesterday.

Emil Salim, chairman of the economic team of the Non-Aligned
Movement (NAM), told newsmen yesterday that the United Nations
Development Program (UNDP) will help solve the external debts of
developing countries.

"The administrator of the UNDP, Gussputh, has agreed to
coordinate related institutions under the UN to revise the
agenda, where debt problems are discussed," Emil Salim told
journalists after reporting to President Soeharto about his trips
to a number of countries to convey the results of the NAM's
ministerial meeting on external debts, which was conducted here
last month.

Emil was accompanied by Minister/State Secretary Moerdiono,
Coordinating Minister for Economy and Finance Saleh Afiff, and
the government's economic adviser Widjojo Nitisastro in
yesterday's meeting with Soeharto, the current chairman of NAM.

Last month, ministers of 31 least-developed NAM countries met
here to discuss the most appropriate approach for solving the
debt crises. They ended their three-day meeting with a call for a
70-percent exemption of the external debts of least-developed
nations.

Emil Salim noted that the UNDP welcomed the results of the
Jakarta meeting and promised to use them as a reference in
revising the agency's agenda.

He said that the appeal of the Jakarta meeting is that it was
rational in that a number of countries truly cannot pay their
debts and even continue to wrangle in debt traps.

"Aid given to least-developed countries to pay their debts
cannot solve their debt problems comprehensively ... as their
buying power will be declining," he said. "Well, developed
countries can channel their aid but least-developed countries
will continue to sink."

Moerdiono noted that there are at least 58 heavily indebted
countries, of which 32 are least-developed countries. The actual
arrears of the 32 countries were much larger than the 20 percent
threshold: 91 percent had arrears exceeding 50 percent, half had
arrears exceeding 86.7 percent and 39 percent had arrears in
excess of 90 percent.

The total of long-term debts of those countries in 1992
amounted to US$247.6 billion, 26 percent of which was owed to
multilateral financial institutions, 49 percent to governments
and their agencies and 24 percent to private creditors. (rid)