ID :
57885
Tue, 04/28/2009 - 08:25
Auther :
Shortlink :
https://www.oananews.org//node/57885
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RI TO ACQUIRE PART OF INDIA'S SHARES IN ADB
Jakarta, April 27 (ANTARA) - Indonesia is ready to acquire 1.5 percent of India's shares in the Asian Development Bank to increase its equity in the multilateral financial institution from currently 5.5 percent.
Syahrial Loetan, secretary of the state minister for national development planning, said here on Monday the government's plan would be discussed at the 42nd annual meeting of the ADB in Bali on May 2-5.
"We have the potential to increase our shares now totalling 5.5 percent. It will all be discussed during the ADB Board of Governors' meeting later," he said.
Syahrial said actually Indonesia could increase its equity in the bank through acquisition by accepting the Indian offer to sell 1.5 percent of its shares in the ADB.
It could also be done by covering the General Capital Increase like members of other donor institutions, he said.
He said ADB President Haruhiko Kuroda actually had already presented the first option to the Indonesian government. "During his visit to the National Development Planning Board (Bappenas) Haruhiko offered the opportunity to increase our equity. The opportunity existed because India was offering part of its shares," he said.
Unlike the GCI option, acquiring shares will increase the country's political leverage in the bank, he said.
He said with it Indonesia would have more votes for determining extension of ADB loans to member countries. "The more votes we have the stronger we will be in having our say heard," he said.
In reaction to the issue, the head of the Indonesian Anti-Debt Coalition, Dani Setiawan, said the government's plan to increase its equity in the bank ignored priorities that the government should give.
"Increasing equity means increasing the number of lost opportunities to finance poverty alleviation programs at home," he said.
He said the decision actually was not necessary because 5.5 percent shares in the bank were quite sufficient for Indonesia with its limited financing capacity.
He said it was hoped the desire to increase debts could be controlled by the country remaining at the current position. "By buying the shares the opportunity for the country to fall into deep indebtedness is wider," he said.
Dani also criticized the agreement to increase ADB's capital by 200 percent recently saying it would make more countries to be trapped in debts. He said the ADB should have sought alternatives instead to make countries to restore their economy without seeking more debts.
Indonesia's total shares in the ADB reached 5.434 perecent of the bank's total capital of US$55 billion or were the sixth largest.
The largest shares in the bank are held by the US and Japan each holding 15.57 percent, followed by China and India respectively holding 6.4 percent and 6.3 percent.
Australia holds 5.7 percent and Indonesia 5.4 percent while the rest 45 percent is distributed among 61 other member countries.
The bank is quite important for Indonesia because the country's debt in the bank is the biggest reaching US$9.4 billion.
In 2008 the bank agreed to allocate US$1.085 billion for disbursement through the Asian Development Fund worth US$160 million and ordinary capital resources worth US$925 million.
As of this year Indonesia can no longer be able to get ADF loans because it has been considered a middle-income country.
Syahrial Loetan, secretary of the state minister for national development planning, said here on Monday the government's plan would be discussed at the 42nd annual meeting of the ADB in Bali on May 2-5.
"We have the potential to increase our shares now totalling 5.5 percent. It will all be discussed during the ADB Board of Governors' meeting later," he said.
Syahrial said actually Indonesia could increase its equity in the bank through acquisition by accepting the Indian offer to sell 1.5 percent of its shares in the ADB.
It could also be done by covering the General Capital Increase like members of other donor institutions, he said.
He said ADB President Haruhiko Kuroda actually had already presented the first option to the Indonesian government. "During his visit to the National Development Planning Board (Bappenas) Haruhiko offered the opportunity to increase our equity. The opportunity existed because India was offering part of its shares," he said.
Unlike the GCI option, acquiring shares will increase the country's political leverage in the bank, he said.
He said with it Indonesia would have more votes for determining extension of ADB loans to member countries. "The more votes we have the stronger we will be in having our say heard," he said.
In reaction to the issue, the head of the Indonesian Anti-Debt Coalition, Dani Setiawan, said the government's plan to increase its equity in the bank ignored priorities that the government should give.
"Increasing equity means increasing the number of lost opportunities to finance poverty alleviation programs at home," he said.
He said the decision actually was not necessary because 5.5 percent shares in the bank were quite sufficient for Indonesia with its limited financing capacity.
He said it was hoped the desire to increase debts could be controlled by the country remaining at the current position. "By buying the shares the opportunity for the country to fall into deep indebtedness is wider," he said.
Dani also criticized the agreement to increase ADB's capital by 200 percent recently saying it would make more countries to be trapped in debts. He said the ADB should have sought alternatives instead to make countries to restore their economy without seeking more debts.
Indonesia's total shares in the ADB reached 5.434 perecent of the bank's total capital of US$55 billion or were the sixth largest.
The largest shares in the bank are held by the US and Japan each holding 15.57 percent, followed by China and India respectively holding 6.4 percent and 6.3 percent.
Australia holds 5.7 percent and Indonesia 5.4 percent while the rest 45 percent is distributed among 61 other member countries.
The bank is quite important for Indonesia because the country's debt in the bank is the biggest reaching US$9.4 billion.
In 2008 the bank agreed to allocate US$1.085 billion for disbursement through the Asian Development Fund worth US$160 million and ordinary capital resources worth US$925 million.
As of this year Indonesia can no longer be able to get ADF loans because it has been considered a middle-income country.
