Indonesia: GOI Signs Biofuel Memorandum of understanding (MOUs) With Local Banks

Minister of Finance Sri Mulyani Indrawati signed memorandum of understanding (MOUs) with state-owned Bank Mandiri, Bank Rakyat Indonesia, Bank Bukopin, and two regional banks, to provide up to Rp 25.6 trillion ($2.8 billion) for the finance the development of agricultural crops for bio-energy and the revitalization of existing plantations. The banks will disburse the loans in stages over the next few years according to plantations’ needs. Under the terms of the MOU, interest rates on loans to plantations will be capped at 10%, with the GOI subsidizing any further interest charges. The GOI pledged in its Fiscal Year 2007 budget to provide interest-rate subsidies of up to Rp 1 trillion ($111 million) to support the program. Coordinating Minister for the Economy Boediono, Minister of Agriculture Anton Apriyantono, Bank of Indonesia Governor Burhanuddin Abdullah and local government heads witnessed the MOU signing. 

Date Implemented: 2006

Status: In Force; Voluntary

References: http://www.usembassyjakarta.org/econ/energy_highlight_dec06.html