21 - A Once-And-For-All Settlement of Indonesia's Foreign Debt (1970)

Summary

Introductory Note: When Indonesia was elected as Chairman of the Non-Alligned Movement of the Developing Countries in 1992, President Suharto gave special attention to the serious problems faced by the highly indebted developing countries and took a number of effective steps. First, he established the Non-Alligned Movement Ad Hoc Advisory Group of Experts on Debt chaired by Dr Gamani Corea (former Secretary General of the UNCTAD) and which later on published its Report. In 1993 President Suharto brought to the attention of the leaders of the seven industrial countries through a meeting with the Chairman of the G-7, the Prime Minister of Japan Mr Kiichi Miyazawa. In 1994 President Suharto convened in Jakarta from 13–15 August 1994 a Ministerial Meeting of Non-Alligned Countries on Debt and Development: Sharing of Experiences. The meeting was attended by ministers from 25 debt-distressed least developed countries (Benin, Bhutan, Cambodia, Cape Verde, Comoros, Djibouti, Ethiopia, Guinea, Guinea Bissau, Lesotho. Liberia, Mali, Mauritania, Mozambique, Myanmar, Niger, Sao Tome and Principe, Sierra Leone, Sudan, Tanzania, Togo, Uganda, Zaire, Zambia). The NAM Advisory Group of Experts on Debt was represented by Dr Gamani Corea and Dr Henock Kifle. The Indonesian delegation consisted of Coordinating Minister for Economic Affairs Dr Saleh Afijf, Ambassador Nana Sutresna, who was Executive Assistant to the Chairman of the Non- Alligned Movement, and the members of the Economic Advisory Team on Debt and Development Issues: Professors Moh. Sadli, Ali Wardhana, Radius Prawiro, Emil Salim, Suhadi Mangkusuwondo, Widjojo Nitisastro. In the meeting I delivered a presentation on Indonesia's experience: “A Once-and-for-all Settlement of Indonesia's Foreign Debt”.

On the final settlement of Indonesia's foreign debt a crucial role was played by Dr Hermann J. Abs from the Deutsche Bank and on the Indonesian side by Mr Rachmat Saleh who was at that time Senior Deputy Governor of Bank Indonesia, later on Governor of Bank Indonesia and then Minister of Trade.

A once-and-for-all settlement of Indonesia's foreign debt was achieved in April 1970, while the above description was delivered in August 1994 at the Non-aligned Ministerial Level Conference whose very poor member countries were heavily indebted.

I am delighted to participate in discussions on the enormous external debt burden of the developing countries with a view to formulating common approaches.