Japan Lends Indonesia 43.6bn for Hydropower Development, Disaster Resilience Program

TEMPO.CO, Jakarta -  Japan Ambassador to Indonesia Kenji Kanasugi and the Ministry's Foreign Affairs' director general of Asia Pacific and Africa Abdul Kadir Jailani signed a note exchange or E/N a loan of ¥43.629 billion yen or around Rp4.9 trillion. The loan is to help finance the development of hydroelectric power plants and strengthen the capacity of the disaster management sector in the Special Province of Aceh.

The Japanese Embassy said that the two countries plan to build the Peusangan II hydropower project worth ¥13.629 billion or Rp1.5 trillion in Aceh.

The loan is expected to help with the construction of a hydroelectric power plant and transmission line facilities and electricity distribution, to minimize power shortages and stabilize the power supplies in the provinces of Aceh and North Sumatra. The long-term goal is to contribute to the economic growth in the northern island of Sumatra, restoring and reviving the areas from the aftermath of the 2004 Indian Ocean Earthquake and Tsunami, and reduce the global environmental burden by utilizing renewable energy.

The loan will also be used to finance another project Japan and Indonesia are carrying out, which is the 'Disaster Resilience Improvement and Management Phase 3' program worth ¥30 billion (Rp3.3 trillion).

Overall, the loan agreement is aimed at encouraging the improvement of policies and systems in disaster prevention, as well as increasing the disaster response capacity in Indonesia, where natural disasters are frequent, in a bid to achieve social and economic conditions that are resilient to disasters.

Suci Sekarwati

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