Jakarta to ask Paris Club for US$2.7b debt rollover (fwd)

[Robert Weissman <rob@essential.org>]

Bloomberg
July 3, 1999
JAKARTA
Jakarta to ask Paris Club for US$2.7b debt rollover
INDONESIA is set to ask its sovereign creditors to reschedule up to US$2.7
billion (S$4.6 billion) in debt for this fiscal year, top economics
minister
Ginandjar Kartasasmita said.
Mr Ginandjar said the government will put the proposal forward at the
annual
meeting of the country's donors, known as the Consultative Group on
Indonesia, in Paris at the end of the month.
Last year, Indonesia's creditors at the so-called Paris Club agreed to
reschedule US$4.2 billion in sovereign debt to free money for the
government
to help pull the country out of recession.
"We could ask for between US$2.6 and US$2.7 billion," Mr Ginandjar said. He
stressed that Indonesia won't propose any debt write-offs.
While Indonesia's economy is seen improving after contracting 14 per cent
last year, it is still heavily dependent on international aid to fund its
budget.
Earlier this week, World Bank managing director Sven Sandstrom said
financing
next year's budget was a major concern given the high costs of
recapitalising
the banking sector.
Any rescheduling that Indonesia receives would require the recommendation
of
the International Monetary Fund, which is leading a US$49 billion economic
bailout package for the nation.
Separately, Mr Ginandjar said inflation may slow to as low as 8 per cent at
the end of March 2000. He also said the rupiah could fall as low as 6,000
to
the US dollar without damaging Indonesia's export competitiveness.