Govt sells sukuk to Haj

The government sold Rp 4.25 trillion (US$467.5 million) worth of sukuk (Islamic bonds) Monday in a private placement method to the Religious-Affairs-Ministry-managed Haj fund, the Finance Ministry said in a statement.
The sale is one part of the government's servicing of the national budget deficit, estimated to reach Rp 133.7 trillion or 2.1 percent of the gross domestic product, based on the 2010 state budget revision.
The placement was a follow-up of the memorandum of understanding signed between the Religious Affairs Ministry and the Finance Ministry on April 22 last year, the statement read.
The sukuk have a 7.55 percent coupon per year, and will mature on May 17, 2013. They cannot be traded.
In early May, the Corruption Eradication Commission (KPK) announced it had identified 48 weaknesses in the Religious Affairs Ministry's Haj fund management, allowing for potential corruption.
The fund management is not yet transparent, KPK deputy chairman M. Jasin said.
Assuming that 700,000 potential pilgrims are on waiting list, there will be about Rp 16 trillion deposited in banks, yielding massive interest, he said.
Speculations were rife the fund may be used to finance the Haj pilgrimages of ministry officials.
Religious Affairs Minister Suryadharma Ali said the interest would be used for passport and visa services, Haj accommodation and transportation and the embarkation and food needs of pilgrims.
He said he would follow-up the issue within the month, and that it would take two years to improve such weaknesses.

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