Sector Program Loan

Period (Date of Loan Agreement):
    October 16, 1998


Amount Provided:
    50,000 million Yen

Executing Agency:
    National Development Planning Agency (BAPPENAS)

As the loan provides Indonesia with the foreign currency for importation, it will contribute, as an immediate effect, to improving the deteriorating international balance of payments of Indonesia. It will also contribute to the achievement of development targets, for the counterpart fund of the loan is to be used for development projects.

The development projects to be financed this time are high priority projects of the Government of Indonesia in the field of agriculture, such as rehabilitation and construction of irrigation facilities and development of infrastructure in rural villages, which will counter the adverse effect of the recent severe drought. The implementation of these labour-intensive projects will contribute to increasing agricultural productivity and also to generating immediate employment in Indonesia which is suffering from the large-scale unemployment caused by the economic crisis.