S&P assigns Indonesia bonds BB-

Standard & Poor's said it assigned its BB- senior unsecured foreign currency debt rating to the Republic of Indonesia's (foreign currency BB-/stable/B, local currency BB+/stable/B) proposed benchmark size dollar global bonds with a maturity of 10 years or longer.

While the full details of the issue are not known yet, in assigning this BB- rating, S&P said it expects that the bond issuance amount will not lead to a material worsening in Indonesia's external position.

Indonesia's general government external debt is not expected to exceed 17.5% of the GDP after this bond issuance, the agency noted.

"The ratings on Indonesia are supported by the sovereign's improving fiscal and external performance, resulting in declining debt burdens," said S&P credit analyst Sani Hamid.

"Small but persistent central government primary surpluses and a falling interest burden should lower general government debt further to about 40% of GDP in 2008, down from more than 100% in 2000."

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