BI to Limit External Debt for Private Sector

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  • TEMPO.CO, Jakarta - Bank Indonesia Governor Agus D. Martowardojo said the central bank will issue new rules governing the private sectors' foreign debt. Agus said the trend of increased foreign debt, especially in the corporate sector, should be watched for.

    The main point that will be regulated is the management of foreign exchange risk, "so that corporate can still obtain foreign loans, but done with healthy signs," Agus said yesterday.

    The rule will also stipulate liquidity risks due to corporate debtors that have no forex reserves. Agus said BI also focuses on corporate health, and the central bank will monitor companies' loan terms, investment placement and investment return (RoI).

    "The risk of debt to investment should be well laid out," said the former Finance Minister.

    BI will work closely with the Financial Services Authority (OJK), the Capital Market Authority, the Directorate General of Taxation, and the Directorate General of Customs and Excise. The rule will also have provisions and sanctions for corporations that violate the regulations.