Renegotiations for Jet Fighter Project Aim to Ease Burden on State Budget
(Source: The Jakarta Post; posted Oct 19, 2018)
Although the Indonesian government has decided to renegotiate the payment schedule it agreed for the next-generation fighter it agreed to develop with South Korea, government officials insist it remains fully committed to the program. (Twitter photo)
JAKARTA --- Investment Coordinating Board (BKPM) head Thomas Lembong stressed that renegotiations for a joint jet fighter development project with South Korea were aimed at easing the burden on the state budget amid uncertainty in the global economy.

“We want to renegotiate the terms of payment,” Thomas said after a meeting at the Office of the Coordinating Political, Security and Legal Affairs Minister in Jakarta on Friday.

Minister Wiranto said it was decided in the meeting that renegotiations would be sought with South Korea on the development of the Korean Fighter Xperimenalt /Indonesia Fighter Xperimental (KFX/IFX), the funding sources for which would be the state budgets of the two countries.

Thomas said Indonesia was seeking renegotiations because under the current agreement, Indonesia would spend hundreds of trillion of rupiah on the project.

According to Thomas, South Korea had agreed to renegotiations during President Joko “Jokowi” Widodo visit to the country. However, South Korea required Indonesia to complete renegotiations within one year.

Thomas said that while renegotiations were under way, Indonesia would disburse funds for the project to assure that Indonesia was committed to proceeding.

The House of Representatives has approved the project, for which Indonesia has agreed to contribute 20 percent of its total needed investment. Indonesia has spent US$ 10 million on the research stage of the project since 2016.

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