JAKARTA (Reuters) – Indonesia is putting 11.5 trillion rupiah ($ 793 million) in state funds with some regional development banks and extending loans to provincial governments to support economic healing amid the pandemic, the finance minister said on Monday.
Minister Sri Mulyani Indrawati stated the program is a follow-up to the 30 trillion rupiah allocated to state lenders which carries similar requirements and targets.
The funds will be placed with regional advancement banks in the capital Jakarta and the provinces of West Java, Central Java, East Java, and North Sulawesi. The government is likewise considering fund positionings at local development banks in Bali and Yogyakarta provinces.
Indrawati also revealed throughout an online briefing a 15 trillion rupiah loan scheme for the provincial federal governments of Jakarta and West Java, the countries top economic and commercial centers, to revive financial activity.
The funds were raised by the central bank buying government bonds, which will allow for low interest expenses for the provincial governments to build roads, markets and health facilities, Indrawati said.
” The objective is to reboot jobs that were delayed due to (spending plan) refocusing efforts and support financial development while supporting COVID-19 health procedures,” Indrawati said.
Indonesias economy is expected to contract or at best hardly grow this year, according to the finance ministry, as the pandemic slashes financial activity.
Reporting by Tabita Diela; Editing by Fransiska Nangoy and Ed Davies
FILE PHOTO:: Indonesias Finance Minister Sri Mulyani Indrawati goes to the World Economic Forum on ASEAN at the Convention Center in Hanoi, Vietnam September 12, 2018. REUTERS/Kham
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