Australian Minister for Foreign Affairs and Trade, Stephen Smith, and his Indonesian counterpart yesterday announced the conclusion of a landmark three-year process which sees the signing of Australia's first debt swap agreement. The Debt2Health initiative of The Global Fund, will see Australia cancel $75 million of debt owed by Indonesia, in exchange for Indonesia's investment of half that amount into public health programs to fight tuberculosis.

Jubilee Australia welcomes the initiative as a concrete step towards dealing with Indonesia's significant debt to Australia:
"Most Australians wouldn't be aware that Indonesian taxpayers are still servicing an $800 million debt to Australia. Nor are they likely to be aware that this debt was racked up through a controversial Australian export scheme operating between the two countries during the notorious Suharto regime. Jubilee Australia has been lobbying over many years for the government to take concrete steps to address this issue, including through a debt-for-development exchange. The fulfillment of this ALP commitment to cancel $75 million of Indonesia's debt through the Global Fund initiative is welcomed".
Adele Webb, Jubilee Australia National Coordinator.

• Fact Sheet: The Global Fund Debt2Health Initiative, July 2010

• Policy Paper: A Debt-for-Development Swap with Indonesia, Jubilee Australia, April 2007