Jakarta – Indonesian Minister of National Development Planning, Suharso Monoarfa, and Hungarian Minister of Foreign Affairs and Trade, Péter Szijjártó, discussed the progress of cooperation in the areas of environment, defense, and health on Tuesday.
“I express my appreciation to the Hungarian government for its continued support to Indonesia through our development cooperation,” Suharso, who is also chairman of the National Development Planning Agency (Bappenas), said in Jakarta on Tuesday.
Officially, Indonesia-Hungary relations, which began on 26 June, 1955, continued with an agreement to mutually support the candidacy of Indonesia and Hungary for the United Nations Security Council.
Hungary has been investing in Indonesia since 2016. In 2020, Hungarian investments in Indonesia reached US$1.5 billion, with most of the funds flowing into trade, hotels, and restaurants in the Bali and Nusa Tenggara regions.
Hungary and Indonesia have also committed to several collaborations focused on technology and infrastructure sectors, Suharso said.
“There are many potential (areas) for cooperation in trade and investment, especially with the plan to form an Indonesia-Hungary Investment Fund to support infrastructure development,” he added.
Hungary has also shown interest in funding the Improving National Climate and Air Quality Service (BMKG) program, the Indonesian Attorney General’s Integrated Intelligence System, and hospital projects under the Ministry of Defense.
This has been put on the List of Medium-Term Foreign Loan Plans (DRPLN-JM) / Blue Book 2020-2024.
The Hungarian government is offering financing facilities, with a soft loan scheme provided by the Hungarian Exim Bank and credit insurance for Hungarian exporters financed by the Hungarian Commercial Bank, Suharso said.
“The Ministry of National Development Planning / Bappenas will coordinate with the Ministry of Finance and related ministries to consider the offer from the Hungarian government,” he informed.
He said his ministry, the Ministry of Finance, and the Hungarian Ministry of Foreign Affairs and Trade have agreed on the procedure for the G-to-G loan.
The procedure will involve use of EUR / USD currency and the loan will be provided at an interest rate of 0.05 percent, based on Commercial Interest Reference Rates, and will be granted with a grace period of two years.
The loan comes with a repayment period of 17.5 years and a bond status of at least 50 percent Hungarian content.
Suharso said Indonesia received a loan of US$36.4 million from Hungary in 2016 to finance the sub-district capital project of the Water Supply Program and the Small Water Treatment Plant for water scarce areas, which ended in August, 2020.
“We got a pretty good lesson from our last cooperation project on Water Supply, namely the importance of accommodating local content in projects supported by Hungarian funding, especially for construction projects,” he said.
Source: Antara News