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Asian Development Bank or ADB in cooperation with the governments of China, Japan and South Korea form a joint credit facility to help financial stability and sustain long-term investment in Asia. ADB to place funds 1 30 million dollars, or about Rp 1.17 trillion in investment and credit guarantee facility, known as CGIF.
In addition to initial capital contributions from the ADB, the additional capital will also be prepared by 13 member countries which cooperate with CGIF, namely the ten ASEAN member countries, including Indonesia, plus China, Japan and South Korea, or ASEAN +3. ASEAN +3 countries expected to raise additional capital amounting to 570 million U.S. dollars. Thus, in the end will collect an initial capital of around 700 million U.S. dollars for CGIF.

The pilot project will use this facility was first performed in 2011 tahuin. CGIF will be used as collateral on bonds issued by private companies in 13 countries of ASEAN +3 with the denomination of local currency. As an illustration, the private Indonesian companies can issue bonds denominated in Japanese yen by using CGIF, and vice versa Japanese companies could issue bonds in the Indonesian rupiah.

By using CGIF, private companies can obtain facilities which will not be easily achieved alone, among others, have the highest debt rating, ie AAA (read triple-A) or commonly known as investment grade. With the debt ratings, the issuer will obtain relief in the cost of issuance.

In this way, the ADB and ASEAN +3 countries hope to reduce the problem of maturity bonds have ever caused the financial crisis in Asia in 1997-1998. The bond market in ASEAN +3 countries are expected to thrive, so they can m enghilangkan problem difficulty obtaining funds for infrastructure investment.

“CGIF allows private companies issue bonds denominated in its own exchange rates or exchange rates in neighboring countries. Connecting the channel savings to investment in the region will support economic growth in the region, which in turn could create employment and alleviate poverty,” said Noy Siackhachanh, advisor ADB Regional Economic Integration issues.(source : kompas)

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