§ Ann ClwydTo ask the Secretary of State for Trade and Industry (1) if Indonesia has resumed payments on its debt to the United Kingdom since it negotiated a rescheduling of this debt with the Export Credits Guarantee Department; [58432]
(2) if the rescheduling agreement with Indonesia on its debt repayments to the United Kingdom contains provisions relating to future loan guarantees for military equipment; [58435]
(3) if he will make a statement on the rescheduling of Indonesia's debt to the United Kingdom. [58433]
§ Mr. WilsonThe UK, together with Indonesia's other major creditors, agreed on 23 September 1998 to reschedule Indonesia's sovereign and sovereign guaranteed public sector debt falling due for payment between 6 August 1998 to 31 March 2000. The rescheduling covers principal repayments only and Indonesia continues to meet its interest payment obligations on the original maturities. The rescheduled debt is to be paid over eleven years including a three year grace period. Moratorium interest at the appropriate market rate will accrue from the dates of the original maturities. The first and subsequent payment dates for this moratorium interest will be specified in the bilateral agreement.
The bilateral debt agreement being negotiated between the UK and Indonesia covers debt in relation to both civil and military contracts signed prior to 1 July 1997 and the debt to be restructured over the period to 31 March 2000 amounts to some £240m.
The bilateral debt agreement, as is usual, will make no reference to future ECGD cover. Bearing in mind that this is to be limited rescheduling involving principal payments only, ECGD remains on cover whilst monitoring developments very closely. New commitments will be considered on a case by case basis, taking account of prevailing circumstances at the time, but priority would be given to contracts likely to contribute to Indonesia's economic recovery.