Italy to scrap 9.3 mln euro Indonesian debt in exchange for humanitarian

Jakarta (ANTARA News) - Italy has agreed to cancel the equivalent of 9.32 mln usd worth of debt that Indonesia owes it on condition that Jakarta spends the same amount on six humanitarian projects in Aceh, an official said.

Aceh, the country's westernmost province, was devastated by a tsunami in December, 2004.

Coordinating Ministry for Economic Affairs spokesman, Mahendra Siregar, was quoted by XFN Asia as saying among the six projects approved by Italy are the building of a bridge and hospital and the reconstruction of a fishing harbour.

Last year, Italy cancelled 4.98 mln eur debt after Indonesia pledged it would spend the same amount on four projects in Aceh.

As of December 31, 2006, Indonesia's outstanding debt to Italy stood at 141.66 mln usd.