REPUBLIKA.CO.ID, JAKARTA -- Banks are ready to extend loans for smelter construction in the country. They support Mining Law No. 4/2009, which requires mining companies to start to build smelter as the export of raw mineral materials is still prohibited.

PT Bank Central Asia (BCA) for example keen to give the credit. However, Corporate Director of BCA, Dhalia M Ariotedjo said that there had been no mining company applying for smelter credit though given five year transition period.

"We will extend the time this year," Ariotedjo said recently as reported by Satya Festiani.

There are no many companies building the processing plant in Indonesia. They said that the cost was too expensive. Ariotedjo said that BCA had a loan portofolio in mining sector, but the figure was small. The credit realization has reached 103.082 trillion IDR and the risk level was high. Therefore, banks choose to form collaboration with several banks or syndicated loans.

PT Indonesia Eximbank is also financing smelter credit in its business expansion this year. The export financing institution is ready to lend up to 1 trillion IDR. Managing Director of Eximbank, Dwi Wahyudi explained that company had disbursed smelter loans since last year. Eximbank will finance the smelter construction with syndicate scheme with several foreign banks, such as China Development Bank and ICBC.

Eximbank has financed two smelters, namely Indofero and Bintang 8 worth 60 million USD or 690 billion IDR. Company targeted to channel such financing at least for two more smelters this year.

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