Saturday, November 20, 2004

RI needs $72b for infrastructures

Source: Jakarta Post

Endy M. Bayuni, The Jakarta Post, Santiago

Building infrastructure will be the bedrock of the government's economic strategy for the next five years, and that means raising no less than US$72 billion, or around Rp 600 trillion to finance related projects, President Susilo Bambang Yudhoyono said on Friday.

The money, he said, would come from all kind of sources: the government, private sector investment, foreign aid, and foreign direct investment.

Such a huge sum is needed to build roads, railways, ports, airports, power plants, clean water and irrigation facilities and other infrastructure, he said on board a Garuda Indonesia plane prior to landing in Santiago.

He also stressed that he would be working closely with regional administrations to meet the goal.

The President is in Santiago to attend the annual Asia Pacific Economic Cooperation (APEC) forum this weekend.Building infrastructure will be among the issues he raises during a series of meetings with other APEC leaders.

He also disclosed that the government would organize the "Infrastructure Summit" in Jakarta in January, to hammer home the point.

The President pledged that the government would strive to improve the climate for investment in Indonesia, both for domestic and foreign investors. That meant improving the political and economic climate, and legal framework, he added.

"We are still calculating to what extent the projects will be financed by the government, the domestic private sector, foreign aid and foreign investors," he said.

He also denied a reversal in government policy on taking new loans.

"We continue to open ourselves up to new loans, as long as they are in our national interests and they are for a good purpose," he said.

His predecessor, Megawati Soekarnoputri, refrained from taking new loans in the last two years, in an attempt to progressively cut Indonesia's foreign debt, which today stands at around $130 billion.

"Our debt level is already too high," President Susilo conceded.

He said the government would continue to strive to reduce the debt through various options, including selling off government assets, privatizing state enterprises, taking bank loans, issuing government bonds, and turning to foreign loans.