Indonesia signs 300 mln aud loan from Australia for road projects

Jakarta (Antara News) - Indonesia has signed an agreement for a 300 million Australian dollar loan from Australia that will be used to improve the quality of roads and bridges in eastern Indonesia, an official said Thursday.

The loan carries zero interest rate, with no associated fees or charges.

The repayment period is 40 years.

The loan is supported by a 209 billion rupiah grant for planning and design to support the delivery of high quality engineering works, the Australian Ambassador to Indonesia, Bill Farmer, was quoted by Thomson Financial as saying in a statement.

He said the funding would improve 750 to 1,000 kilometers of national roads and bridges, leading to reduced travel costs and times.

Construction work is expected to commence in the first half of 2008.

"Australia is working closely with the Ministry of Public Works to identify and improve those parts of the road network most in need of rehabilitation. These improvements are expected to generate real economic benefits for Indonesia," Farmer said.

Initial priorities for road improvement include the south and east coasts of South and Southeast Sulawesi, West and South Kalimantan, and Bali and West Nusa Tenggara.

Initial support will also be provided to replace bridges in North Sulawesi washed away by floods in early 2006. (*)
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