Search

 

Cablegate: Exim Officials Seek Opportunities to Expand Participation

VZCZCXYZ0000
RR RUEHWEB

DE RUEHJA #1941 3290758
ZNR UUUUU ZZH
R 250758Z NOV 09
FM AMEMBASSY JAKARTA
TO RUEHC/SECSTATE WASHDC 3919
INFO RHMFISS/DEPT OF ENERGY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEATRS/DEPT OF TREASURY WASHDC

UNCLAS JAKARTA 001941

SIPDIS
SENSITIVE

STATE FOR EAP/MTS
STATE ALSO FOR EEB/ESC/IEC/ENR, S/CIEA, AND EEB/IFD
ENERGY FOR PI-32 CUTLER
COMMERCE FOR 4430 NADJMI AND 6930
TREASURY FOR T RAND AND G RAO
STATE PASS TO USTR EHLERS AND WEISEL
STATE PASS TO EXIM

E.O. 12958: N/A
TAGS: ECON EFIN ENRG EPET EINV ID
SUBJECT: EXIM OFFICIALS SEEK OPPORTUNITIES TO EXPAND PARTICIPATION
IN INDONESIA

1. (SBU) During a recent visit to Indonesia, Member of the Board of
Directors of the U.S. Export-Import Bank Diane Farrell and Vice
President Ray Ellis met with bank executives to explore the
possibility of establishing a credit facility. ExIm also met U.S.
and Indonesian business executives Indonesian government officials
to seek opportunities for expanded participation in the Indonesian
power and infrastructure sectors.

Credit Facility Garners Interest
--------------------------------

2. (SBU) Senior officials from five domestic Indonesian banks -
Mandiri, BCA, BNI, Danamon, and the Indonesia ExImbank - expressed
interest in participating in a credit facility with ExIm. Under
this facility, the participating domestic bank will vet local
projects and act as a domestic lender or guarantor. ExIm will then
provide a guarantee to an international lending bank, which will
provide financing for the project through the domestic bank. This
arrangement will facilitate ExIm participation by reducing the
country risk premiums required on non-sovereign loans by Footnote 4
of ExIm's Country Limitation Schedule. Farrell and Ellis also met
with Citibank to discuss the credit facility, although that bank is
unlikely to participate as a local lender. Citibank can play a role
as one of the guaranteed lenders.

3. (SBU) All five Indonesian banks expressed a desire for new
lending opportunities, because they all currently have a surplus of
cash. Sebastian Paredes, the President Director of Danamon Bank,
stated that Indonesian banks' response to the financial crisis a
year ago was to increase cash reserves. However, he said the
resulting surplus of cash was not an optimum situation, either.

ExIm and Electricity Development
--------------------------------

4. (SBU) ExIm also seeks to support U.S. participation in
Indonesia's power sector development. Indonesia plans to add an
additional 10,000 MW of power generation capacity, including about
3,600 MW of geothermal power, much of it through independent power
producers. ExIm participation in the sector has so far been
hampered by the lack of sovereign guarantees for PLN, the
state-owned electricity monopoly. Director of Geothermal Sugiharto
Harsoprayitno and PLN Chairman Alhilal Hamdi stated that the
Presidential decree that will authorize the new 10,000 MW plan will
include an explicit government guarantee for the electricity offtake
contracts. Farrell stated that, depending on how the guarantee is
worded, ExIm may be able to consider it a sovereign guarantee and
offer support for these projects.

5. (U) Ray Ellis has cleared on this cable.

HUME

© Scoop Media

 
 
 
World Headlines

 


Palestinian Ministry of Health: Developments In The Health Situation During The Israeli Aggression On The Cities & Governorates Of The Gaza Strip
For the second day in a row, the Israeli aggression against the Gaza Strip continues by targeting overcrowded residential areas and neighborhoods, as the death toll rose to 13 citizens, including a 5-year-old girl and a 23-year-old woman... More>>


UN: Horn Of Africa Faces Most ‘Catastrophic’ Food Insecurity In Decades, Warns WHO

The World Health Organization (WHO) warned on Tuesday that the Greater Horn of Africa is experiencing one of the worst famines of the last 70 years... More>>

FAO: Warns 90 Per Cent Of Earth’s Topsoil At Risk By 2050
A full 90 per cent of the Earth’s precious topsoil is likely to be at risk by 2050, according to the UN Food and Agriculture Organization, FAO...
More>>


Somalia: ‘We Cannot Wait For Famine To Be Declared; We Must Act Now’
Rising acute food insecurity in Somalia has caused more than 900,000 people to flee their homes in search of humanitarian assistance since January last year, the Food and Agriculture Organization (FAO) has warned... More>>

UN: American West Faces Water And Power Shortages Due To Climate Crisis
Two of the largest reservoirs in the United States are at dangerously low levels due to the climate crisis and overconsumption of water, which could affect water and electricity supply for millions in six western states and Mexico, the UN Environment Programme (UNEP) warned on Tuesday... More>>



Singapore: UN Experts Call For Immediate Moratorium On Executions For Drug Offences

UN experts* today condemned the execution of Nazeri Bin Lajim, a 64-year-old Malay Singaporean national convicted of drug offenses and urged the Government of Singapore to halt plans to execute individuals on death row for drug related charges... More>>