Indonesia_istock.jpg

Jakarta, Indonesia

During a meeting with the country’s president Joko Widodo, ADB president Takehiko Nakao declared the bank would boost its lending to as much as $2bn a year over the next five years.

Despite rapid progress in recent years, around 11% of Indonesia’s population, or 28 million people, live below the poverty line. As much as 60% of the country’s workforce is employed in the informal sector, where incomes are insecure.

Nakao welcomed Indonesian government initiatives to boost infrastructure, such as capital injections into state-owned enterprises and government guarantees for direct lending by international financial institutions.

He said the bank will also continue to help the country improve the quality and accessibility of education, reduce the cost of doing business through policy-based loans and assist the government in meeting the commitments made at December’s international climate change conference COP21.

 The ADB will also provide further support to the government’s development strategy which covers the period up until 2045.

“While the market should play an important role for development, good development strategy and planning is indispensible,” Nakao highlighted.

He commended the Indonesia’s “wide-ranging economic reforms”, which he said have bolstered market confidence despite global financial volatility but also stressed the importance of continuing efforts to boost domestic tax revenue.

“It is critical for Indonesia to continue and strengthen the momentum of reforms to help diversify its economy and enable all Indonesians to benefit from the country’s growth potential,” the ADB president said.