• Register Email Updates

• Advanced Search
• Help

Japan's Pledge of Assistance to Indonesia at the 12th Consultative Group Meeting on Indonesia (CGI)

January 22, 2003
Embassy of Japan, Indonesia

1. At the 12th Consultative Group Meeting on Indonesia (CGI) organized by the World Bank and held on January 21 and 22 in Bali, the Japanese Delegation, headed by Yutaka Iimura, Ambassador of Japan to the Republic of Indonesia, stressed the importance to continuously implement economic reforms, with securing sufficient understanding of people on the necessity of reforms, and to enhance economic growth driven by private investment through active measures taken to improve investment climate. The Delegation expressed the Japanese Government's unchanged commitment to extending utmost support to Indonesia's reform efforts.
2. Contents of specific assistance announced by the Japanese Delegation was as follows:

   (1) In addition to the "South Sumatra-West Java Gas Pipeline Construction Project," a special yen loan project for which the E/N was signed on January 21 (about US$400 million, about 49.1 billion yen), the Delegation announced the three new yen loan projects amounting to about US$730 million (about 88.9 billion yen):

   1) The Surabaya Airport Construction Project (II): About US$120 million (about 15.0 billion yen)
   2) The Muara Karang Gas Power Plant Project: About US$460 million (about 55.8 billion yen)
   3) The Muara Tawar Gas Fired Power Plant Extension Project: About US$150 million (about 18.2 billion yen)

   The total amount committed under these loan projects comes to about US$1.13 billion (about 138 billion yen)

   Japan attaches high importance to the support for the areas of electric power and energy. By providing assistance in these areas, Japan intends to support efforts for structural reform in energy sector currently being pushed for and, at the same time, help Indonesian endeavors to resolve the electric power crisis that could become a serious bottleneck for sustainable growth and stable lives of people.

   (2) With regard to assistance through debt rescheduling, January 21 witnessed the signing of the Paris Club III bilateral agreement. The Delegation announced that, through this debt treatment, during fiscal 2003, Japan would contribute up to US$1.5 billion, in accordance with the financing gap examined by the IMF in the form of debt scheduling.

   (3) As to Japan's support for filling the financing gap in fiscal 2003, the Delegation announced that Japan would contribute about US$730 million (about 88.7 billion yen) of assistance through the disbursement of yen loans, an untied loan and grant aid assistance in pipeline.

   Combining the disbursement of these projects and programs in pipeline, which amounts to US$730 million, and the assistance through the debt rescheduling amounting to US$1.5 billion, Japan will be contributing about US$2.23 billion (about 272 billion yen). This contribution covers more than one-third of the total external financing needs of US$6.3 billion in fiscal 2003

   * Note : Breakdown of support for financing gap
   (1) Projected disbursement value of existing yen loans and grant aid cooperation projects: About US$530 million (about 64.4 billion yen).
   (2) Projected disbursement value of an untied loan from the Japan Bank for International Cooperation (the former Export-Import Bank of Japan): About US$200 million (about 24.3 billion yen).

   (4) Aiming at supporting the on-going peace process at this critical juncture, the Delegation announced the following assistance.

   a) To provide food assistance amounting to US$5 million for IDPs and other conflict-affected people in Aceh through WFP
   b) To provide assistance to quick impact projects from which local communities in Aceh directly benefit
   c) To consider supporting programs for disarmament, demobilization and reintegration in Aceh
   d) To consider contributing US$ 1.2 million to HDC to be used for the expense of the monitoring of the cessation of hostilities by JSC
   e) To promote the capacity building of the local governments in Aceh, to start training programs for members of local officials from February
   f) For the restart of suspended projects and for the formation of new projects, the security conditions at project sites have to be carefully assessed as the peace progresses. Japan will soon send a mission to formulate its assistance policy toward Aceh from broad perspectives, including the security perspective.

3. Japan hopes that, with effective use of this assistance, the Indonesian Government will appropriately respond to the country's development needs, and achieve further economic stabilization and promotion of growth driven by investment in private sector.