Belgian export credit agency (ECA) ONDD has eased its cover policy on Indonesia for medium and long-term export transactions. The cover ceiling is henceforth set at €
450mn. The premium category (5 out of 7) remains unchanged. Demanding a guarantee from the Indonesian State for transactions with public debtors has been dropped.
The Indonesian economy seems – despite the recent nervousness on the exchange markets – on its way to return to the situation prior to the financial crisis of 1997-98 with sustained regional trade contributing.
The December 2004 tsunami lead to a Paris Club moratorium on foreign debt already rescheduled and due in 2005 has not shattered this positive trend that has intensified since President Yudhoyono’s tenure of office, believes ONDD. He seems to pursue the most urgent reforms such as implementing a supportive environment for investments, reorganising the still delicate financial sector and eliminating the budget deficit, the agency has announced.
Together with a cautious policy mix, this latter aim should allow to reduce even more the public debt, which, in spite of the unsteady state revenues, is coming closer to manageable levels. The foreign financial situation continues to improve, too, says ONDD. Though the foreign debt service still prompts to wariness in spite of its marked contraction, ratios are henceforth set at sustainable levels.