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IFIs in Indonesia
This series of monthly factsheets on International Financial Institutions (IFIs) will include information on the World Bank Group, the International Monetary Fund (IMF) and the Asian Development Bank (ADB), focussing on their involvement in Indonesia. |
The ADB was founded in 1966 with an objective of promoting the social and economic progress of the Asian and Pacific region. Funds come from member governments, borrowing on the world capital markets, and the Bank's own earnings.
The Asian Development Bank (ADB)'s principal functions are to:
The ADB is headquartered in Manila. It has 56 member countries of which 40 countries are from the Asian and Pacific region and 16 from Europe and North America. The largest shareholders are the United States and Japan and the largest borrowers are Indonesia and China. The transportation and communications sector have received the largest share of lending, followed by energy, social infrastructure, multi-sector loans, agriculture and natural resources, industry, finance, and non-fuel minerals. Total yearly ADB lending is US$6-7bn.
Concerns and Consultation with civil society, NGOs and campaigners
As with the other IFIs the ADB pursues a policy of conditionality on loans that usually includes privatisation, deregulation and encouragement of foreign investment. Critics say these kind of policies have done little to reduce poverty or protect the environment. Like the World Bank, the Asian Development Bank has a much better record on consultation than the IMF. NGOs can insist on meeting with mission teams, highlight policies/targets that have not been implemented and policies that have been problematic and suggest policies that could be included. NGOs should contact ADB Indonesia Liaison Officer, Cecile Gregory. Details below.
Lending to Indonesia
As of December 1999, ADB's active portfolio in Indonesia was 77 loans for 65 projects with a net lending total of US$8.09bn. Most of the lending in US$ is in social infrastructure but much is also in Energy and Finance/Industry. (See Table 1)
Table 1. Cumulative ADB Loan Portfolio
| Sector | US$bn lending | % of total lending | Number of loans |
| Agriculture/Natural Resources | 1.10 | 14 | 26 |
| Energy | 1.86 | 23 | 8 |
| Finance and Industry | 1.52 | 18 | 4 |
| Social Infrastructure | 2.80 | 35 | 29 |
| Transport and Communications | 0.78 | 9.5 | 9 |
| Others/multi-sectors | 0.04 | 0.5 | 1 |
| TOTAL | 8.09 | 100 | 77 |
Yearly Lending
Yearly, the ADB lends around US$bn 1-2 to Indonesia, of which most goes to the public sector, mainly to encourage privatisation and deregulation. Small and influential amounts also go to 'Technical Assistance': this is to the private sector. (See Table 2.)
Table 2. Yearly lending
| Public Sector Lending | Technical Assistance | |||
| US$ billion | Number of Projects | US$ million | Number of Projects | |
| 1999 | 1.02 | 6 | 11.27 | 19 |
| 2000 estimate | 1.02 | 8 | 17.78 | 23 |
| 2001 estimate | 1.10 | 8 | 10.70 | 13 |
| 2002 estimate | 1.30 | 8 | 1.00 | 1 |
Net transfers from ADB to Indonesia are however much lower due to debt repayment.
Table 3. Net transfers ADB to Indonesia
| Year | US$bn Net transfer |
| 1996 | 1.20 |
| 1997 | 0.12 |
| 1998 | 0.58 |
| 1999 | 0.69 |
For an overview of ADB's lending to Indonesia see the Jan. 2000 Country Assistance Plan at http://www.adb.org/Work/Country/Assistance_Plans/caps.asp
Indonesia projects in 1999
Table 4. Public and Private Sector Loan Approval in Indonesia
| Total loan US$m | Date Approved | |
| Power Sector Restructuring | 400 | 23 March 1999 |
| Health and Nutrition Sector | 300 | 25 March 1999 |
| Community and Local Government Support Sector | 320 | 25 March 1999 |
From ADB Annual Report at http://www.adb.org/About/Annual_Report/ar1999/t01-15r.pdf
Summaries of ADB Environmental Impact Assessments (SEIAs and SIEEs) for Indonesia projects are available at http://www.adb.org/Work/Environment/SEIAs/INO.asp
ADB Contacts:
1. ADB Permanent Office in Indonesia:
| Indonesia Director: | Robert C. May |
| NGO Liaison: |
Cecile Gregory |
| Address: | 7th floor, Gedung BRI II, Jl. Jend Sudirman Kav. 44-46, Jakarta 10210 |
| Telephone: | 021 251-2721 |
| Fax: | 021 251-2749 |
| Indonesian web-site: | None |
2. ADB Head office:
| Address: | 6 ADB Avenue, Mandaluyong City, Metro Manila, Philippines |
| Tel. | (632) 632 5897 |
| Fax. | (632) 636-2684 |
| Main web-site: | http://www.adb.org |
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