Japan's Assistance announced at the Eighth Meeting of the Consultative Group for Indonesia (CGI)

July 28, 1999

At the eighth meeting of the Consultative Group for Indonesia (CGI) held on July 27 (Tue) and 28 (Wed) in Paris under the auspices of the World Bank, the Japanese delegation headed by Mr. Takao Kawakami, Japanese Ambassador to Indonesia, announced the following bilateral assistance to Indonesia for this fiscal year, with a view to assisting the country's efforts to overcome economic difficulties and meeting financial demand to implement policy measures for the socially vulnerable and others.
As part of the New Miyazawa Initiative indicated in February, Japan pledged to extend an ODA loan of about 72,000 million yen. Japan also announced that it would extend grant assistance of about 5,000 million yen, and technical cooperation of about 12,000 million yen including development studies. In addition, Japan explained that an amount of about 99,000 million yen to be disbursed in FY1999 out of the ODA loans pledged in the past would contribute to the financial demand in FY1999 in Indonesia. The total amount of Japan's ODA to be disbursed to Indonesia in FY1999 comes to about 188,000 million yen.
Japan also announced, for FY2000, its intention to extend as much assistance as possible to help the new administration continue its political and economic reform lines, and to study future assistance taking account of what is needed, while exchanging views with the new administration.
This meeting was attended by 20 countries including Indonesia and 14 international organizations including the World Bank. They pledged that the international community would extend concerted assistance to Indonesia, expecting that Indonesia, which, after completing its general elections without turmoil, has begun to see bright signs on the economic front, will continue its efforts for political and economic reforms under any administration in the future.
At this meeting, views were exchanged on "Emerging From Crisis: Staying on the Course of Reform", "Building a longer-term Development Agenda", "Addressing Governance and Corruption", "Foreign Assistance Needs and Pledging", etc.
Assistance of about 5,900 million dollars in total was announced by the participant countries and international organizations. It was confirmed that Indonesia's demand for funds in FY1999 to be met at this meeting would be satisfied.

As the largest donor country to Indonesia and also a responsible member of the Asian community, Japan stated that it was prepared to extend as much assistance as possible for Indonesia's self-help efforts even though its own financial condition was severe. Japan then announced the following assistance for this fiscal year, urging the Government of Indonesia to continuously promote its political and economic reforms, in particular, democratic and fair "good governance", and to implement projects in an efficient and transparent manner.

(1)

ODA loans (new loans of about 72,000 million yen, about 99,000 million yen to be disbursed out of those already pledged)

(a)	As part of the assistance package of yen equivalent to a total of 2,400 million dollars that was indicated in February under the New Miyazawa Initiative, an ODA loan, "Social Safety Net Adjustment Loan", of about 72,000 million yen will be extended by co-financing with the World Bank.
(b)	Out of yen loans already pledged, a total of about 99,000 million yen will be disbursed in FY1999.

(2)

Grants

(a)

Grant assistance totaling 5,000 million yen will be extended (assistance for the general elections and East Timor already pledged in FY1999, new educational projects, etc.).

(b)

Technical assistance including development studies
Technical assistance will be implemented mainly for projects to build human resources in the fiscal and financial fields for the smooth implementation of the New Miyazawa Initiative, and to help the south-south technical cooperation center. Ten development studies will be conducted with the principle that priority is given to "soft" projects including policy-assistance-type surveys and projects which benefit urgent issues such as "social safety net".
All told, the amount of technical assistance will be approximately 12,000 million yen.

(3)

Export-Import Bank of Japan
Out of the assistance package equivalent to about 2,400 million dollars under the New Miyazawa Initiative indicated in February, the amount of yen equivalent to 100 million dollars will be extended through the Export-Import Bank of Japan to the "Policy Adjustment Support Loan II", which is a co-financing with the World Bank.

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