News Brief: IMF Management Strongly Welcomes Indonesian Debt Agreements
June 4, 1998
IMF Management Strongly Welcomes Indonesian Debt Agreements
Michel Camdessus, Managing Director of the International Monetary Fund (IMF), strongly welcomed today’s agreements reached in Frankfurt between Indonesia and the Bank Steering Committee on interbank debt, trade credit, and corporate debt. He said: "These agreements, which have the immediate effect of relieving the pressure on the foreign exchange market and will help to revive international trade and economic activity, are of major importance for the Indonesian economy.
"The corporate debt scheme provides a framework that not only reduces scheduled Indonesian external payments over the next few years, but also gives corporations substantial initial cash flow relief--thus providing them breathing space to recover from the current crisis. Participation is voluntary, with restructurings--some of which will need to involve debt reduction--to be worked out between individual corporations and their creditors. Because it reduces exchange rate uncertainty and restructures the debt, the scheme should be attractive to both debtors and creditors," Camdessus said.
"An IMF staff team will conduct discussions on the second review of Indonesia’s IMF stand-by program with the Indonesian authorities in Jakarta, beginning next Monday, June 8," Camdessus added.