Indonesia will receive from Japan a loan of US$425 million, to be allocated for climate change programs, and a grant totaling $22.2 million for construction projects in Nias Island and West Nusa Tenggara.

The signing ceremony for the loan and grant took place Thursday during the second Bali Democracy Forum (BDF) underway on the resort island, between President Susilo Bambang Yudhoyono and Japanese Prime Minister Yukio Hatoyama, and between Indonesian Foreign Minister Marty Natalegawa and Japanese Ambassador to Indonesia Kojiro Shiojiri.

The two leaders co-chaired the two-day forum. The loan program is the first concrete case of the so-called “Hatoyama Initiative” to support Indonesia’s measures to tackle the impact of climate change.

“We expect this loan will further facilitate measures related to climate change in Indonesia and will contribute to the country’s continued economic development,” Hatoyama said at a joint press conference with Yudhoyono.

Part of the loan, $317.8 million, will be used to contribute to the mitigation and adaptation efforts against global warming, through carbon absorption and emission controls, as well as to respond to cross-sectoral issues of climate change.

The remaining $107 million will be an “emergency budget support” to further push Indonesia’s efforts on climate change countermeasures.

During the forum, Japan also agreed to grant $17.2 million for the reconstruction of six bridges in Nias Island, which suffered serious damage from earthquakes along the northern Sumatra coast in 2004 and 2005.

“This project will be used to facilitate the transport of goods and contribute to the reconstruction program in Nias by making use of Japan’s earthquake-resistance technology,” said Japanese Foreign Ministry press secretary Kazuo Kodama.

Another grant, of $5 million, will go toward the construction of four bridges in West Nusa Tenggara to improve access for residents in the underdeveloped region.

Yudhoyono and Hatoyama held a bilateral meeting Thursday during which they agreed to strengthen cooperation on a range of issues, including how to work together to make the Copenhagen climate change talks a success.

“We’ve agreed to enhance economic cooperation,” Yudhoyono said, adding Jakarta expected
Tokyo to invest more in Indonesia through the Economic Partnership Agreement (EPA).

Hatoyama said he appreciated Indonesia’s target to cut carbon emissions by 26 percent by 2020, adding Japan was committed to extending assistance to Indonesia in addressing climate change issues.

Yudhoyono said if the assistance was forthcoming, Indonesia would be ready to increase the reduction target to 41 percent by 2020.

The meeting between the two leaders was the third since both were voted into office earlier this year.

The first was in Pittsburgh in September during the G20 meeting, and the second in Thailand in October during the East Asian Summit.

Popular

Is Indonesia really ready to embrace dual citizenship?

Palm oil plantation-less mills lead to increase deforestation

Prabowo inaugurates construction of Majapahit palace replica