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ADB extends $1b loan to Indonesia
The Asian Development Bank (ADB) has approved a US$1 billion loan to Indonesia to help the country sustain critical public expenditure for the economy amid the global financial crisis.
One of the largest single loans the ADB has ever provided to Indonesia is expected to support poverty alleviation, social protection and infrastructure maintenance, ADB said in a statement Thursday.
"The global financial crisis has made it expensive for Indonesia to access international debt markets and trade finance, which could constrain spending on essential social services and poverty alleviation programs," said Jaseem Ahmed, the director of ADB's financial sector, public management and trade division for Southeast Asia.
The loan, dubbed Indonesia's Public Expenditure Support Facility, is part of a joint effort by the ADB, the Australian government, the Japanese government and the World Bank. ADB's $1 billion loan brings the total amount to $5.5 billion.
The government may withdraw the facility funds to meet quarterly financing shortfalls through to the end of 2010.
The government has said it will draw the money only if market conditions remain tight, constraining the efforts to plug this year's budget deficit.
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