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Indonesia to get $7b loan from World Bank, ADB, AIIB
The funds will be used to finance the country’s widening budget deficit of 5.07 percent of GDP.
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Indonesia will receive around US$7 billion in loans from the World Bank, Asian Development Bank (ADB) and Asian Infrastructure Investment Bank (AIIB) to finance the country's fights against COVID-19. (Shutterstock/Icatnews)
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ndonesia will receive around US$7 billion in loans from the World Bank, Asian Development Bank (ADB) and Asian Infrastructure Investment Bank (AIIB) to finance the country's fights against COVID-19.
Bank Indonesia (BI) Governor Perry Warjiyo said on Tuesday that the funds would be used to finance the country’s widening budget deficit of 5.07 percent of gross domestic product (GDP) to prevent a greater health crisis and economic meltdown from the COVID-19 outbreak. He, however, did not unveil the details of the planned loan.
“The AIIB, ADB and the World Bank planned on around $7 billion [in loans] during an investor teleconference. We will maximize it,” Perry told House of Representatives Commission XI overseeing financial affairs. “The Finance Ministry has also said that it will maximize the government’s budget.”
Read also: Government debt issuance to triple to $62b as Indonesia fights COVID-19
President Joko “Jokowi” Widodo has announced additional state spending worth Rp 405.1 trillion to finance Indonesia’s battle against the novel coronavirus pandemic. The new allocation will be used specifically for health care, the social welfare safety net and business-recovery programs.
In funding the extra budget, the government has resorted to debt issuances, international institution loans and state budget reallocation.
