ADB Increases Lending to Indonesia

Head of the National Development Planning Board (Bappenas) Sofyan Djalil and ADB President Takehiko Nakao giving press statement at Presidential Office (12/2)

President of the Asian Development Bank (ADB) Takehiko Nakao said that the Asian Development Bank (ADB) will increase lending to Indonesia to about US$10 billion within the next five years (2016-2020) or US$ 2 billion per year to finance the country’s infrastructure projects.

“The ADB President said that ADB is ready to provide loan to fund our infrastructure projects,” said Minister of National Development Planning/Head of the National Development Planning Board (Bappenas) Sofyan Djalil in a press statement after accompanying President Joko Widodo in the meeting with the ADB President Takehiko Nakao at the Merdeka Palace on Friday morning (12/2).

Sofyan added that the ADB would also provide direct loans to banks.

“The interest rate of the loans from ADB is low. It won’t be more than 2 percent. The loan tenor can reach 30 years,” Sofyan added.

In addition to providing loans for projects, Sofyan said that the ADB would also provide policy-based loans and result-based lending.

The result-based lending, Sofyan added is the financing whose disbursement is related with the outputs that have been made and not with the funding of the projects that have been spent.

“Thus, they (ADB) is not related with the tender system. It’s only us that is involved in the tender because Indonesia’s tender system is considered quite good,” Sofyan added.

Sofyan further said that the most important project is the project in energy sector.

In  the meeting with the ADB representatives, President Joko Widodo was accompanied by Minister of Finance Bambang Brodjonegoro and Minister of National Development Planning/Head of the National Development Planning Board (Bappenas) Sofyan Djalil. (DND/ES) (EP/YM/Naster)