ANNOUNCEMENT 16 Sep 2015In September 2015, the government of Indonesia announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
Press release by the Finance Ministry (in Bahasa Indonesia)
On 16 September 2015, the Indonesian Finance Ministry announced it would provide Indonesian companies in labour-intensive industries facing layoffs subsidised loans worth 1 trillion IDR (ca. 68 million USD).
The loans will be assessed by the Indonesian Eximbank (LPEI) on a case-by-case basis. The loans will bear an interest rate of 7.5 i.e. the national bank's benchmark rate, whereas usually they would face a commercial lending rate above 10%.
The Minister of Finane was quoted in the media saying that companies who have already fired staff will be eligible for the scheme only if they rehire the personnel.
The Chairman of the Board of Directors LPEI Ngalim Sawega added in a press report (cf. Sources) that the state aid would focus on the following industries: crude palm oil, textiles and textile products, footwear, paper products, rubber, coal and cocoa.
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.