Indonesia to Unlock $400-Million Loan
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JAKARTA, Indonesia — Indonesia and the International Monetary Fund are expected to sign today a new agreement that would unlock a $400-million loan held back since December, the Indonesian Finance Ministry said.
The agreement would follow a week of negotiations between the country’s economic ministers and a visiting IMF team led by Anoop Singh, the fund’s Asia-Pacific deputy director and principal negotiator with Jakarta.
Talks with the IMF centered on overcoming the deficit in the draft budget for the coming fiscal year, stabilizing the rupiah and speeding the sale of assets taken over by the Indonesian Bank Restructuring Agency during the country’s financial crisis of 1998-1999.
On Thursday, the IMF agreed to ease Indonesia’s base money target, essentially allowing the government to circulate more money in the economy. That was in response to central bank complaints that it can’t meet targets set out by the fund in earlier agreements.
Under the agreement signed between the IMF and the Indonesian government, the base money target, or money in circulation, is set at $12.3 billion this year.
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