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ec. 17, p3

Japan will provide Indonesia with a total of ¥150 billion (US$1.46 billion) in loans to boost development of vital infrastructure in the country in the coming years.

Industry Minister MS Hidayat said on Monday that the loans, made available through Japan'€™s Overseas Development Agency (ODA), would help finance dozens of projects under the Metropolitan Priority Area (MPA) program, including their feasibility studies. The cooperation under the MPA program was signed by both governments in 2010.

Your comments:

This loan must be another spillover from Abenomics, after we saw several recent Japanese acquisitions of financial institutions here.

Can we expect some more spillovers in real sectors?

D Van Man

It'€™s good to get loans but the money must be paid back. Also, at what interest rate must it be paid back? The article did not include this. Then there are Japanese investments, where I am sure they want to make a profit. I hope all goes well, with such huge amounts of money involved.

Eddy

There'€™s a hidden purpose in this project.

Zuri Sutrisno

Historically, the interest rates for Japanese development loans were set at a very low rate, around 1-2 percent.

Remember that this is a government loan, not a private sector loan, and naturally the profits the Japanese government is looking forward to are not measured in terms of financial return, but rather in building closer bilateral ties and increasing private-sector trade between both countries.

Lifel

The strings attached are that mainly Japanese consulting and construction companies can bid for the contracts.

So the funds that are given are flowing back to the lending country.

Henry Manoe