WB approves the release of US$400m loan to Indonesia

WB approves the release of US$400m loan to Indonesia

JAKARTA (JP): The World Bank approved the release of a US$400
million loan to Indonesia on Tuesday, completing the disbursement
of the $1 billion loan package signed in July last year.

The World Bank said the loan approval reflected the continued
progress of reforms in Indonesia's structural and financial
sectors.

The World Bank is satisfied with recent policy developments in
Indonesia, citing the recently announced changes in regulations
governing forestry management and palm oil export taxes as
examples.

"Despite enormously difficult circumstances, the government is
making progress in its reform efforts," the World Bank's country
director for Indonesia, Dennis de Tray, said in a statement.

He also noted that portfolio reviews for all banks under the
supervision of the Indonesian Bank Restructuring Agency had been
completed, and that the government was moving to accelerate the
restructuring of banks in order to reestablish effective banking
services.

"A framework for debt and corporate restructuring has been
established and many firms have begun to seek restructuring
assistance under the Jakarta Initiative," De Tray added.

However, De Tray reminded Indonesia that it still faced many
challenges in its efforts to restore its economy.

"The World Bank remains committed to helping Indonesia on this
journey in any and every way we can," De Tray said.

The $1 billion loan package was signed on July 2, 1998, under
the name of the Policy Reform Support Loan.

The loan is intended to provide the Indonesian government
budgetary support for reforms in the structural and financial
sectors, and to meet urgent social needs.

The initial $600 million was disbursed immediately after the
loan was signed last year. (02)