Tsunami summit excludes debt moratorium talks

Tsunami summit excludes debt moratorium talks

Fabiola Desy Unidjaja
The Jakarta Post/Jakarta

The government has decided not to include the discussion on a
debt moratorium for Indonesia in the agenda of the upcoming
international emergency relief summit, the Minister of Foreign
Affairs Hassan Wirayuda said on Tuesday.

However, while saying that the government was not in a
position to ask for such a facility, Hassan was quick to add that
it would not nevertheless reject any offers that might come from
the donors.

"The debt moratorium will not be discussed in the coming
summit, but if some countries would like to bring it up, we would
welcome it," Hassan told a press conference following a limited
Cabinet meeting to discuss the preparations for the summit.

The government expects to secure pledges from international
donors at the forthcoming summit on Thursday for the
rehabilitation of Aceh and North Sumatra, which were hit by an
earthquake and massive tsunami which has so far killed more than
94,000 people.

The government has said that it was likely to spend at least
Rp 10 trillion (US$1.07 billion) for reconstruction in the
provinces over the next five years.

Minister of Finance Yusuf Anwar said last week that, while the
government would ask the World Bank and Asian Development Bank
(ADB) to start reimbursing their undisbursed loan commitments, it
would also seek debt relief from creditors grouped under the
Paris Club.

At the moment, undisbursed loan commitments from the World
Bank and ADB stand at about $3 billion.

Several donor countries -- Germany, France, the U.S. and
United Kingdom -- have indicated they were willing to offer debt
relief for disasters-stricken countries, including Indonesia.

Debt relief would be helpful for the cash-strapped government,
with some Rp 46 trillion (USS5.11billion) set to mature this year
which effectively limits its ability to finance rebuilding.

Elsewhere, Vice President Jusuf Kalla said that the government
would welcome any debt rescheduling offers, and had asked the
National Development Planning Agency (Bappenas) to look into
which debts could be rescheduled.

The Vice President further said the government should take the
initiative to pursuit the offer from donor countries to support
relief efforts in Aceh.

Some 26 countries as well as international organizations have
agreed to attend Thursday's emergency meeting, which will discuss
various rehabilitation programs for the affected countries as
well as an early warning system in the region to prevent a repeat
of such a calamity.

Meanwhile, Dow Jones reported that the government and several
donor countries had agreed to set up a joint office in Jakarta
for the reconstruction of the two provinces.

"The joint office will coordinate all grants and loans
designated for Aceh reconstruction," Anggito Abimanyu, a senior
official at the finance ministry, was quoted as saying.

He said that the United Nations Development Program (UNDP)
would coordinate relief work, which is expected to take six
months.

The World Bank, Japan, and the Asian Development Bank will
coordinate the rehabilitation program, which is expected to take
two years, and the reconstruction, which will likely take up to
five years, Anggito said.