U.S. to provide funds for RI food imports

U.S. to provide funds for RI food imports

MANILA (Reuters): The United States is likely to sign an agreement soon that would provide concessional financing for Indonesia's import of American food products, a U.S. Department of Agriculture official said yesterday.

"We met several times with Indonesian government officials regarding the PL 480 Title 1 portion and I think we made a great headway...and we are very close to being ready to sign that agreement," USDA general sales manager Christopher Goldthwait told Reuters.

PL 480 is a program to boost U.S. farm exports, and the Title 1 agreement provides for government-to-government export transactions with financing in foreign currency.

Goldthwait is in Manila on the third leg of an Asian trip to promote U.S. farm exports. In addition to Indonesia and the Philippines, he visited Singapore and is leaving Manila for South Korea later on Tuesday.

"It is possible that it (a loan) will be signed as early...as the end of this week," he said. "It will cover soybeans and rice, and there is also a wheat component...through a private sector agreement with two...flour mills."

Goldthwait identified the two Indonesian flour mills as Sriboga and Citra.

Goldthwait said the U.S. government was looking at plans to donate wheat to Indonesia as part of U.S. President Bill Clinton's food aid initiative.

"The Department of Agriculture is planning on purchasing 2.5 million tonnes of wheat at our domestic market in an effort to increase U.S. farm prices," he said.

"That wheat would be...donated as food aid to countries. Indonesia is one among the countries that we are looking at and based on my visit there, there is a need for some additional food assistance beyond what we have provided for under PL 480," Goldthwait said.

Indonesia, one of the countries hit hardest by the Asian currency crisis, has also utilized USDA's farm export credit guarantees.

"We have a $400-million allocation for exports to Indonesia, of which we have seen utilized about $100 million worth...largely by the textile industry and by the Bulog for purchasing soybeans," Goldthwait said, adding the credit line was for the current U.S. fiscal year ending Sept. 30.

Bulog is Indonesia's state trading firm.

The credit line was part of more than $2 billion in export credit guarantees opened by the USDA to South Korea, Malaysia, Indonesia, Singapore, Philippines and Thailand since last December as part of its campaign to keep its farm exports moving into the region despite the Asian currency crisis.

Goldthwait said he expected Indonesia to import roughly four million tonnes of rice this year and about four million tonnes of wheat. He did not give comparative figures.