World Bank agrees on loan to Indonesia

JAKARTA (JP): The World Bank has formally agreed to provide a US$381 million loan to finance infrastructure projects in Indonesia.

The loan agreement was signed in Washington on Friday by the Indonesian Ambassador to the United States Dorodjatun Kuntjoro- Jakti and by the World Bank's Acting Vice President for East Asian and Pacific Region Javad Khalilzadeh-Shirazi.

Under the agreement, the World Bank will provide a US$381.2 million loan to the Indonesian government to finance the development of infrastructure facilities, an education program and environmental conservation.

Dorodjatun said the new loan commitment indicated the World Bank still had confidence in Indonesia.

"We are very thankful that the World Bank is still willing to give financial aid to Indonesia given the current economic crisis," Dorodjatun said.

According to the embassy, around $234 million of the loan will be used to finance the development and rehabilitation of roads in Northern Sumatra, and $6.9 million will be used to finance a coral reef rehabilitation and management project.

About $103.5 million of the loan will be used to finance the development of a basic education project for the poor in West Java.

The loans will also be used to finance rural development projects in Maluku ($16.3 million) and Bengkulu ($20.5 million).

Meanwhile, Khalilzadeh-Shirazi said the aid proved the World Bank still respected Indonesia's progess in developing education, environmental conservation and infrastructure. (gis)