The Agency Franchise de Development (AFD) and the Indonesian Finance Ministry have signed a US$200 million loan agreement to support the Climate Change Program conducted by the Indonesian government, an official said on Tuesday.

"The loan program is on a grant basis and very, very favorable (loan)," said Rahmat Waluyanto, the Director General of Debt Management under the Indonesian Finance Ministry.

The purpose of this climate change program loan, which will be disbursed as a budgetary support, is to sustain Indonesian driven policy reform for dealing with climate change issues and to help the implementation of agreed policy targets stated in the form of a three-year "Policy Matrix" (revisable every year).

Targets of the Policy Matrix are divided into three parts, namely mitigation, adaptation and cross-sectional issues. In this program, AFD is a partner of the Japan International Cooperation Agency (JICA) which has already granted a US$300 million loan to the Indonesian government.

"Our cooperation between AFD and the Indonesian government is not only limited in loan agreement, but also technical assistance program which is related to climate change. The assistance is aimed directly at the Indonesian Forestry Ministry and the Industry Ministry," he said. 　

(Xinhua News Agency November 25, 2008)