Informasi, Kebudayaan &
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Jakarta, 14 June 2006     At the outset, on behalf of the Government of Japan and the Japanese people, I would like to extend our deepest condolences to the victims of the earthquake disaster in Yogyakarta and Central Java. We believe that determination and devotion of the Indonesian government and its people will certainly enable a rapid recovery. Japan will certainly continue to support recovery efforts.     Also, let me assure you that Japan remains committed to support Indonesia in tackling major challenges it faces, including in achieving sustainable development through economic growth, in building democratic and just society, and in building peaceful and stable nation. In this relation, I am pleased to report you that today I am going to sign Exchange of Notes concerning Japan’s grant assistance for the provision of three high-speed patrol vessels to the Indonesian Maritime Police. This grant is a part of our cooperation to combat piracy and terrorism.     Let me start by briefly touching upon the macroeconomic outlook.     First, I would like to commend the efforts of Indonesian Government in pursuing solid macroeconomic management and economic reforms that have enabled its economy to steadily recover from the Asian economic crisis. Furthermore, Indonesian growth potential has been enhanced by the vigorous structural reform efforts like two rounds of significant fuel price increase last year.     Second, it is indispensable to further accelerate economic growth in order to absorb increasing labor forces and thus to reduce poverty. In this regard, the Indonesian Government is facing significant challenges in both macroeconomic and structural policy: i.e. maintaining macroeconomic stability and consolidating fiscal sustainability, on the one hand, and promoting financial sector reform, improving investment climate and accelerating much needed investment in physical and social infrastructure, on the other hand.     Concerning investment climate, we highly appreciate the government’s consistency in giving high priority to this issue.     In this regard, the CGI Working Group on Investment Climate has played an important role in giving clear focus to our discussion. After presenting, in October 2004, a report containing suggestions to the government, the Group reviewed, in December 2005, the actions taken by the government and made a proposal on remaining priority actions. Most proposed priority actions are incorporated into the government’s two economic policy packages announced in February and in March this year. We really appreciate the package and strongly hope that the government will take the planned actions as scheduled.     In the context of bilateral cooperation between Japan and Indonesia, we are working in the High-Level Public/Private Sector Joint Forum on Investment, where we launched SIAP, Strategic Investment Action Plan, in June 2005. Based on the discussions in the Joint Forum, Japan is supporting Indonesian government’s actions through its technical cooperation program. Also, Japan is providing ODA soft loans, i.e. Yen loans, to infrastructure projects such as construction of power plants and access road to Tanjung Priok port. These projects are expected to contribute to solving bottlenecks related to productive sector investments, and thus to creating jobs. Japan also co-financed the Development Policy Loans with the World Bank and ADB. In this relation, Japan is putting emphasis on the importance of ensuring the operational risk management for infrastructure development. We do hope to see further progress in the government’s work on this issue as soon as possible.     Let me express our sincere hope for further efforts of the Indonesian government on the issue of investment climate. I reaffirm, on behalf of the Japanese government, the continued commitment to support the efforts of the Indonesian government, both through activities of the Investment Climate WG and through bilateral cooperation programs. Pledging Statement of the Japanese Delegation |