ADB mulls to guarantee
Indonesian debts

The Asian Development Bank is exploring a plan to guarantee Indonesia's debt instruments in a bid to help the largest economy in Southeast Asia reduce cost of borrowings.

"We are exploring a guarantee facility in support of bonds, loans and other debt instruments issued by the Government of Indonesia. The guarantee will help lower the cost of financing to the government," said ADB president Haruhiko Kuroda after a meeting with Finance Minister Sri Mulyani Indrawati in Jakarta on Monday.

Kuroda said that ADB and the international community were prepared to consider favorably any reasonable request for assistance from Indonesia. He also said that Indonesia's economy "has been well managed."

Finance Ministry's director general for debt management Rahmat Waluyanto said the government would benefit from the guarantee should it issue another bond in the future. The guarantee, he said, would improve Indonesia's sovereign rating, thus lowering the yield.

"However, the plan is still at an early stage. It is an idea. There is not decision as yet," Rahmat said after a hearing with the House of Representatives. (and)

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