Tonight's Bloomberg:
Top Business/World News
Thu, 22 Jan 1998, 12:53am EST
Rupiah Plunges 23% to New Low on Debt Concerns
The Indonesian rupiah plunged for a sixth day -- plummeting 23 percent to a new record low against the U.S. dollar -- as the country's mounting debt crisis compounded concerns of political fragility. The rupiah dropped to as low as 15,000 to the dollar in early trading, after falling about 15 percent yesterday. Indonesia is trapped by ''political instability and economic insolvency,'' said Andy Tan, general manager of MMS International in Singapore. The plunging rupiah -- which has fallen about 82 percent in the past year -- has made it next to impossible for Indonesian companies with rupiah revenue, to service their $65 billion in foreign debt. Also, the debt is owed by more than 1,500 companies -- from noodle makers to taxi companies -- making it difficult to restructure.
Indonesia Stocks Fall, Led by Gudang Garam, as Rupiah Drops
Indonesian stocks fell, led lower by clove cigarette maker PT Gudang Garam, as the collapse of the rupiah to record lows created concerns about the solvency of the nation's companies. Corporate Indonesia has $65 billion in foreign debt, the rupiah value of which has swollen to over 700 trillion rupiah, from about 150 trillion rupiah in the middle of last year. The Jakarta Stock Exchange Composite Index fell 16.09 points, or 3.45 percent, to 449.91, as 52 of the traded stocks fell and 10 rose. Gudang Garam fell 1,550 rupiah, or 15 percent, to 8,950 rupiah and its only publicly traded competitor, PT Hanjaya Mandala Sampoerna, fell 475 rupiah to 4,725 rupiah. |
