ID :
64286
Thu, 06/04/2009 - 20:42
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https://www.oananews.org//node/64286
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GOVT MUST TIGHTEN EXTERNAL DEBT POLICY : FORMER MINISTER
Jakarta, June 4 (ANTARA) - The government must tighten its external debt policy so that the funds could be used as effectively as possible to serve the people's interest, former economic and industrial affairs minister Kwik Kian Gie said.
"The government must be tight in seeking new loans from overseas. It must tightly select all unfinished projects that need funds or canceled projects if there are indications that their implementation would be delayed for a long time, or any projects made through collusion," the former minister said here on Thursday.
He said that the government should reject the offer of a donor agency which wanted to lend its money for development projects which actually only benefited the agency or country country.
"Rich countries and donor institutions should not persuade Indonesian officials to design projects and to borrow their money with high interest," Kwik Kian Gie said.
In the meantime, to finance various development programs according to Kwik Kian Gie, the government could issue global bonds but should not carry high interests that would pose a burden to the state.
"It should not issue global bonds which carry an interest rate of 12-13 percent. This would post a burden to the future government," he said.
President Susilo Bambang Yudhoyono said recently in South Korea that the Indonesian government would not use external loans to reinforce its fiscal financing although the South Korean government had offered assistance.
"If there is no urgent need, we should not necessarily borrow money although South Korea has offered us a loan," the president said here before leaving South Korea for Jakarta, on Tuesday.
He said that although the ratio of Indonesia's external debts to its gross domestic product (GDP) continued to drop it did not mean that the government should be lured to unnecessarily create new debts.
Yudhoyono said that calculations on how much debts were needed to stimulate growth and cover budget deficit were carefully made because debts could become a short-term solution but in the long run could turn into a burden.
Yudhoyono said that the ratio of Indonesia's external debts to its gross domestic product continued to narrow from 53.4 percent in 2004 to 32 percent in 2009.***2***
"The government must be tight in seeking new loans from overseas. It must tightly select all unfinished projects that need funds or canceled projects if there are indications that their implementation would be delayed for a long time, or any projects made through collusion," the former minister said here on Thursday.
He said that the government should reject the offer of a donor agency which wanted to lend its money for development projects which actually only benefited the agency or country country.
"Rich countries and donor institutions should not persuade Indonesian officials to design projects and to borrow their money with high interest," Kwik Kian Gie said.
In the meantime, to finance various development programs according to Kwik Kian Gie, the government could issue global bonds but should not carry high interests that would pose a burden to the state.
"It should not issue global bonds which carry an interest rate of 12-13 percent. This would post a burden to the future government," he said.
President Susilo Bambang Yudhoyono said recently in South Korea that the Indonesian government would not use external loans to reinforce its fiscal financing although the South Korean government had offered assistance.
"If there is no urgent need, we should not necessarily borrow money although South Korea has offered us a loan," the president said here before leaving South Korea for Jakarta, on Tuesday.
He said that although the ratio of Indonesia's external debts to its gross domestic product (GDP) continued to drop it did not mean that the government should be lured to unnecessarily create new debts.
Yudhoyono said that calculations on how much debts were needed to stimulate growth and cover budget deficit were carefully made because debts could become a short-term solution but in the long run could turn into a burden.
Yudhoyono said that the ratio of Indonesia's external debts to its gross domestic product continued to narrow from 53.4 percent in 2004 to 32 percent in 2009.***2***
