|
Loan Name
|
Precautionary Financing Facility |
| Country |
Indonesia |
|
Loan Number
|
2871 |
| Project Number |
46239- 01 |
| Source of Funding/Amount[Approved] |
| Ordinary Capital Resources |
US$500.00
million
|
|
| Sector/Subsector |
Public Sector Management / Economic and Public Affairs Management
|
| Gender Mainstreaming Category |
No gender elements
|
Safeguard Categories
|
| Environment |
C |
| Resettlement |
C |
| Indigenous People |
C |
| Stakeholder Communication, Participation and Consultation |
| During Project Design |
On 20 February 2012, IRM received a formal letter from MoF addressed to President Kuroda, asking for ADB to work with other development partners to develop what they called cooperation framework similar to what we provided in 2009. Before the formal request, an informal request was received by ADB and other development partners in December 2011 for a precautionary financing. Since then, IRM have engaged in productive discussions on nearly a weekly basis to look at the proposal. IRM has been very careful in managing expectations with the government and, in fact, throughout the process, IRM has discussed the pros and cons with the government and development partners. An important reason for the government is the lesson emanating not only from the 1997/98 crisis but also from the 2008/09 crisis. The request is put forward by the government based on advanced thinking on potential risks that are still there despite the countrys current good economic performance. The facility should be seen as part of the country's economic risk management strategy given current uncertainties and its large financing needs from market sources.
|
| During Project Implementation |
The Ministry of Finance (MOF) will be the Executing Agency to coordinate, monitor, and evaluate the implementation of the Financing Plan and the Governments countercyclical fiscal stimulus programs supported by the loan. MOF will form a steering committee to oversee the implementation of the Financial Plan and the Governments countercyclical programs. The monitoring efforts will utilize the government system. For example, for infrastructure spending the government has also assigned the UKP4 to monitor and coordinate its implementation. The committee and development partners will meet in the first week of each quarter to review: (i) macroeconomic conditions; (ii) implementation of the Financing Plan; (iii) disbursement of the Governments countercyclical public expenditure programs; and (iv) the Governments financing shortfall. The coverage period for INO-PFF is from 1 July 2012 to 31 December 2013. The loan of $500 million is to be disbursed when the Government has met the drawdown conditions set out in the Governments Financing Plan and conditions for loan effectiveness. The proceeds of the program loan will be disbursed in accordance with the provisions of ADBs Simplification of Disbursement Procedures and Related Requirements for Program Loans.
|
| Responsible ADB Officer |
Edimon Ginting
|
| Responsible ADB Department |
Southeast Asia Department
|
| Responsible ADB Division |
Indonesia Resident Mission
|
| Concept Clearance |
22 Jun 2012 |
| Fact-finding |
23 Jun 2012 to
08 Jul 2012 |
| Board Approval |
18 Jun 2012 |
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