Indonesia and China agree to loan

INDONESIA and China signed a preliminary agreement yesterday that will allow the Southeast Asian nation to borrow US$1 billion to purchase Chinese products, Indonesia's Vice President Jusuf Kalla said.

The Export-Import Bank of China will provide the loan, which can be used to buy equipment, such as machinery that Indonesia can't produce, from China, Kalla said in Jakarta yesterday. Indonesia is turning to bilateral loans after the cost of selling debt rose because of the global credit crisis. The government will make infrastructure projects a priority to absorb workers amid the global recession, President Susilo Bambang Yudhoyono said on December 11.