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New Financial Policy Package Issued

Monday July 10, 2006

To accelerate economic development, the Government has recently issued the Financial Policy Package on 6th July 2006, which is the third in a series of Economic Package Policies, following the Investment Package and the Infrastructure Package, said Coordinating Minister for the Economy, Boediono. The Financial Policy Package aims to streamline working relations between the Government and ’s Central Bank, Bank , as the country’s fiscal and monetary authority. The package takes further measures in the reform of the financial sector, and strengthens financial non-bank institutions as well as the capital market.



While the Investment Package is aimed to improve ’s competitiveness in today’s tight global competition, and the Infrastructure package is aimed to rebuild infrastructure and increase its capacity, the Financial Policy Package aims to improve market and institutional infrastructure, increase access to capital by the business sector, and improve the financial sector so as to strengthen and stabilize it. In so doing the stability of ’s macro-economy, as has been achieved in the past months, may be further maintained to become a solid base for the recovery of the production sector, through adequate financing support from financial institutions and the capital market.



The Package specifies in detail the strategy and direction of ’s financial policies, and the commitment of each agency to achieve targets within specified timeframes.



In the latest developments, Bank has again lowered its BI rate with 25 base points to 12.25 per cent, triggering a return of investments into the Jakarta Stock Market and the strengthening of the Indonesia Rupiah, both of which slumped during the past few weeks.    According to Bisnis Indonesia, IHSG index on 7 July stood at 1,347.91, up from below 1,200 some two weeks ago, while the Rupiah today stands at Rp. 9.165 to the


US Dollar.



For details of the Financial Policy Package of 6 July 2006, open the homepage of the Coordinating Ministry for Economic Affairs, by clicking