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Saturday, 27 September 2008

Indonesian government to issue Sukuk in forex in October 08

Jakarta (ANTARA News, 25 Sep 08) - The Indonesian government is optimistic it will be able to issue sukuk (Islamic state bonds) in foreign currencies this year in spite of current unfavorable market conditions.

"It remains scheduled at the end of next month but we also continue monitoring market developments to decide the right time for it," the finance ministry`s director general of debt management, Rahmat Waluyanto, said here on Thursday.

He said global Islamic bond market conditions, especially in the Middle East. were better than in the US. "Non-deal roadshows last June proved there is quite strong interest in such bonds," he said before attending a meeting with the House of Representatives (DPR)`s Commission XI.

He said the government would use a mechanism with minimal risks and choose the right time for their issuance and therefore it would still conduct another roadshow before making any transactions.

Regarding the future development of the state bonds (SUN) market, Rahmat said foreign investors still believed in the country`s economic fundamentals.

"We see there has not been much redemption in foreign SUN ownership. If that happens, the rupiah`s value will decline," he said adding that the rupiah`s exchange rate remained secure and relatively stable or was even strengthening.
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