Small and medium firms want debt rescheduling

Small and medium firms want debt rescheduling

JAKARTA (JP): A group of small and medium-scale businesses
under the Reformed Entrepreneurs Forum (FPR) has agreed to form a
committee to resolve their unpaid matured debts to domestic
banks.

The forum's chairman, Naldy Nazar, said Saturday the group
would meet with Bank Indonesia Governor Sjahril Sabirin next week
to discuss the possibility of rescheduling their debts, Antara
reported.

Naldy said the committee consisted of representatives from
eight business organizations.

The eight organizations are the Indonesian Builders
Association, the Indonesian Sugarcane Association, the Federation
of Indonesian Clove Cigarette Manufacturers Association, the
Association of Indonesian Wood Panel Producers, the Indonesian
Cement Association, the Indonesian Employers Association, the
Indonesian Furniture and Handicraft Industries Association and
the Indonesian Association of Small and Medium Enterprises.

The committee will ask their banks to reschedule their debt
repayments so that they can maintain their businesses during the
current economic hardship, he said.

It will ask local banks for a grace period of five to eight
years, he said.

The rescheduling of debt repayments was crucial because many
business activities in the country had ground to a halt since the
monetary crisis started last year, he said.

Naldy urged the government to help resolve the problem of
domestic debts, as they were of no less importance than foreign
debts.

The entrepreneurs were having problems getting the money to
repay their rupiah-denominated debts, he said.

"Many companies have sacrificed their working capital to repay
debts. If that's the case, it's only a matter of time before they
go bankrupt," he said.

Naldy said the government's treatment of both types of debts
must be equal, especially since most companies which have
domestic debts are small and medium enterprises.

The rescheduling of domestic debts would help revive the
people's economy on the lower level, he said.

He also urged the Indonesian Chambers of Commerce and Industry
(Kadin) to help small and medium entrepreneurs to resolve their
debt problems.

"Kadin must not only attend to the dollar-denominated debts of
big companies and forget smaller ones like us," Naldy said.

The chamber's chairman, Aburizal Bakrie, has said the chamber
will ask for the rescheduling of the private sector's dollar-
denominated debts which totals US$32 billion. (das)