http://www.thejakartapost.com/detaillatestnews.asp?fileid=20051220191016&irec=0
Indonesia may seek to extend debt, interest payments JAKARTA (Bloomberg): Indonesia said it is studying a plan to extend some debt and interest payment schedules, part of a strategy to use funds for projects that will boost the economy. "We are planning to discuss this with a number of overseas creditors, probably through the Paris Club," planning minister Paskah Suzetta told reporters in Jakarta on Tuesday. "We need to study this carefully so it won't disturb investment or hurt market confidence." Indonesia owes $133 billion in domestic and overseas debts, the central bank said last week. While the Paris Club of 19 creditor nations agreed in March to delay about $4.7 billion of Indonesian debt due this year, rearranging more loans would be difficult because Indonesia isn't part of the InternationalMonetary Fund's aid plan, analyst Fauzi Ichsan said. The plan to use the Paris Club is "impossible" unless Indonesia returns to the International Monetary Fund's program, giving the creditor nations a benchmark against which to judge the nation's creditworthiness, Ichsan, an economist at StandardChartered Bank Plc, said in a phone interview from Bangkok. The Paris Club deferred Indonesia's debt to help the nation recover from the damage caused by the Dec. 26 tsunami, which left more than 160,000 people dead or missing in Aceh and North Sumatra provinces. The Club said then it won't seek repayments this year from nations hurt by the tsunami. The deferred amountswill be repaid over five years with the interest accrued in 2005 to be repaid at rates determined by the nations involved, the Paris Club said then. Indonesia was under a $5 billion aid package with the International Monetary Fund from 1998 to 2003, during which the government had to present a specific economic program called the letter of intent to the fund as part of the loan agreement. The fund disbursed the loans in stages at the time, depending on theprogress of the specific targets set in the letter of intent. "Coming back to the IMF program is politically impossible," Ichsan said. "One possible way is to refinance the debt through bond issuance. The government can sell the bonds then use the proceeds to pay the debts." Indonesia sold $1 billion of dollar-denominated bonds in April and $1.5 billion in October to cover an estimated Rp 24.9 trillion deficit target estimated for this year. Indonesia's government in January said it didn't want to suspend debt repayments because it may hurt the country's credit ratings. Indonesia's overseas debt is rated B2, five levels below investment grade, by Moody's. It is ranked B+, four steps less than investment grade, by Standard & Poor's. (**) [Non-text portions of this message have been removed] ------------------------ Yahoo! Groups Sponsor --------------------~--> Know an art & music fan? Make a donation in their honor this holiday season! http://us.click.yahoo.com/.6dcNC/.VHMAA/Zx0JAA/uTGrlB/TM --------------------------------------------------------------------~-> Post message: [EMAIL PROTECTED] Subscribe : [EMAIL PROTECTED] Unsubscribe : [EMAIL PROTECTED] List owner : [EMAIL PROTECTED] Homepage : http://proletar.8m.com/ Yahoo! Groups Links <*> To visit your group on the web, go to: http://groups.yahoo.com/group/proletar/ <*> To unsubscribe from this group, send an email to: [EMAIL PROTECTED] <*> Your use of Yahoo! Groups is subject to: http://docs.yahoo.com/info/terms/
