Japan announces $593 million loan for socioeconomic projects

The Japanese government announced Friday a plan to disburse a total of US$593 million in loans for five projects related to Indonesia's socioeconomic development.

Notes and provisions on the loans were exchanged by the two countries Thursday in a meeting attended by Japanese Ambassador to Indonesia Shin Ebihara and the Indonesian Foreign Ministry's special staff for managerial affairs, Ibnu Said.

The projects are expected to improve Indonesia's investment climate and human resources, as well as contribute to economic stability at the macro level.

Of the total loans, a maximum of $120.2 million is allocated for the improvement of irrigation systems in nine provinces in western Indonesia, including Java, Sumatra and Kalimantan.

It is expected that improved irrigation systems will boost food stability and the eradication of poverty through an increase in food production.

A total of $87.6 million will be also made available for a similar program in nine provinces in the eastern part of the country.

Japan will charge 1.4 percent interest for the two projects, while the Indonesian government has 30 years to repay the money.

The loans will also go to a double-rail train project in the southern part of Java, serving the route from Cirebon, in West Java, to Kroya, in Central Java.

A total of $58.6 million is also provided for drainage pipe construction in Denpasar, Kuta and Sanur, all in Bali.

A total of $143 million will be made available for the development of the University of Indonesia, one of the top 100 universities in Asia. (lva)