Funding for mining sector set to increase this year

Financing for the country?s mining sector is set to increase this year on the back of rebound in the price of commodities, according to some lenders.

Bisnis Indonesia quoted Acting Executive Director of Indonesia Eximbank, Susiwijono Mugiarso as saying Saturday that the bank has set an 18.7 percent growth in export financing this year to Rp 105.09 trillion.

He said that to help realize the lending target, Indonesia Eximbank will focus on five sectors including mining and leading commodities including coal.

Last year, the bank channeled Rp 10.8 trillion of financing for the mining sector, which accounted for about 12.20 percent of total lending, Susiwijono said, but did not provide projection for this year.

Aside from coal, Indonesia Eximbank will also provide loans for domestic smelter projects, said Acting Director Dwi Wahyudi. ?This year, we?ll (also) focus on funding for smelter projects such as nickel, bauxite, and others,? he said.

Meanwhile, the paper quoted President Director of leasing firm PT Candra Sakti Utama Leasing (CSUL), Suwandi Wiratno as saying that the recovery of the mining sector will increase lending to the miners this year including for purchase of heavy equipment.

He said that demand for financing of heavy equipment purchase has been rising during January and February, and that his company has set a target for financing volume of Rp 600 billion-Rp 700 billion in the first quarter of this year, more than double last year?s same period lending volume of about Rp 300 billion.

He said that CSUL aims to channel Rp 2 trillion-Rp 2.3 trillion of loans this year. (*)