Ministry of Finance: Indonesia will not Issue IDR 450 Trillion of Pandemic Bonds

The Ministry of Finance of Indonesia has decided to scrap its plans of issuing “Pandemic Bonds” worth IDR 450 trillion in response to the impacts of the COVID-19 pandemic. The Financing and Risk Management Director General of the Ministry of Finance, Luky Alfirman, stated that the Government of Indonesia will not issue specific securities including the “Pandemic Bonds”.

Alfirman added that the Government will instead issue debt securities through regular auctions, in order to finance the widening budget deficit. Alfirman added that the Government could rely on Bank Indonesia as a last resort to absorb the offered bonds if the market response was not up to expectation. As a result of the impacts of...