Martin Crutsinger, Washington – The International Monetary Fund on Friday gave approval for a $372 million loan to support economic reform efforts in Indonesia.

The decision by the IMF's 24-member executive board came after a review of the country's recent actions to meet IMF-imposed economic conditions.

In a statement, IMF First Deputy Managing Director Stanley Fischer said the international lending agency "welcomed Indonesia's recent progress in implementing fiscal and structural reform measures."

IMF support for Indonesia had been suspended after the government failed in March to meet a deadline set by the agency to achieve various targets designed to restore growth and stability to the economy. The loan suspension put on hold further disbursements from a $5 billion assistance package the IMF has offered to Indonesia.

In April, Indonesian President Abdurrahman Wahid fired two key financial ministers after receiving a warning from Fischer that the country should guard against backsliding in its reform efforts.

Indonesia was one of the hardest-hit countries during the 1997-98 Asian financial crisis. The $372 million loan approved Friday would bring to $715 million the total loans the IMF has extended out of the $5 billion package.

New IMF Managing Director Horst Koehler is currently on a five-nation tour in Asia and is scheduled to meet on Sunday with Wahid.

Fischer said in his statement that recent market turmoil in Indonesia and declines in the value of the rupiah, the nation's currency, "underscore the need for clear and consistent implementation" of economic reforms.

"Critical priorities are the restoration of a sound banking system and resolution of the overhang of corporate debt," Fischer said.