1. The Government of Japan has decided to extend a new Yean Loan (Soft Loan) of up to 10.794 billion yen (US$ 100 million) to the Government of Republic of Indonesia as a co-financing loan for the First Development Policy Loan of the International Bank for Reconstruction and Development (IBRD). Notes to this effect were exchanged on March 24 in Jakarta between H.E. Mr. Yutaka Iimura, Ambassador of Japan to the Republic of Indonesia, and H.E. Mr. Herijanto Soeprapto, Director General of Asia Pacific and Africa, Department of Foreign Affairs of the Republic of Indonesia.

2. This loan aims to support reform efforts of the Government of Republic of Indonesia to achieve macroeconomic stability, to improve investment climate and to enhance governance.

3. The conditions of the loan are as follows;
(1) Annual interest rate: 1.3%
(2) Repayment period (grace period): 30 years (10 years)
(3) Procurement condition: General untied loan

4. With this loan, the aggregate of Japan’s Yen Loan to the Republic of Indonesia amounts 4.237 trillion yen.

(note)
The First Development Policy Loan
IBRD decided to extend the First Development Policy Loan in the amount of 300 million US$ in December, 2004 to support the Government of Indonesia’s efforts to sustain macroeconomic stability and accelerate the momentum of economic policy reform.