RI to ask for disbursement of all donors` aid commitments

Jakarta (ANTARA News) - Indonesia will ask the World Bank, the Asian Developemnt Bank (ADB) and the Japan Bank for International Cooperation (JBIC) to disburse all the aid commitments of its donor countries totaling US$1.75 billion to cover a deficit in its 2007 state budget, a development planning official said.

Syahrial Loetan, secretary of the National Development Planning Board (Bappenas), said here Thursday the foreign loans would be used to cover a Rp40.6 trillion or 1.1 percent deficit in the 2007 state budget.

He said the House of Representatives (DPR) had agreed to the plan to cover the budget deficit with foreign loans.

Syahrial said the deficit was meanwhile expected to increase to 1.5 - 1.8 percent but the government had at present no plan to seek additional loans to cover the extra shortfall.

"Finance Minister Sri Mulyani and National Development Planning Minister Paskah Suzetta have said if the deficit increases, the extra deficit should be covered with foreign loans only if efforts to raise funds from other sources fail," Syahrial said.

He said the increase in the deficit could be covered with money saved through greater efficiency in spending and the issuance of state debentures. If these efforts failed, steps could be taken to obtain more foreign laons.

The US$1.75 billion loans consisted of 600 million dollars from the World Bank, one billion dollars from the Asian Development Bank and the remaining one from the Japan Bank for International Cooperation.