Trade financing for Indonesia

Trade financing for Indonesia

TOKYO (Nikkei): The Ministry of International Trade and Industry has started applying stricter criteria in providing trade insurance for projects in Indonesian, the Nihon Keizai Shimbun reported Wednesday quoting ministry sources.

MITI has reduced the number of Indonesian banks that are qualified to extend debt guarantees for local projects that receive trade insurance to 33 from 42. All twenty non-Indonesian banks remain qualified, but the number of locally-owned banks has been nearly halved from 22, ministry officials said.

Those with low net worth or exhibit other indications of poor financial standings lost their qualified status.

The ministry has also introduced a system to continuously monitor the financial conditions at healthy Indonesian companies that are qualified for its trade insurance without bank guarantees.

Previously, the credit ratings of such businesses were reviewed every six months. Almost 400 companies are being monitored at present.