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TOKYO: Japan plans to extend up to 500 billion yen (4.8 billion dollars) worth of low-interest loans to developing countries over the next five years to help them fight global warming, a report said Thursday.

The first batch of the new loans would go to Indonesia and total some 20-30 billion yen, the Nikkei economic daily said, adding Nigeria and Guyana are also candidates of aid recipients in the future.

Japan's government plans to provide the loans for alternative energy projects such as wind and solar power generation, the installation of energy-saving equipment at power plants and forestation projects, it said.

The new yen loans would carry annual interest rates of 0.4-0.5 percent, substantially lower than the already low interest rates of some 1.0-1.2 percent now charged on 40-year loans provided by Japan, the Nikkei said.

Japan is hoping to shape the course of negotiations on a new climate treaty, which would cover the period after the Kyoto Protocol's obligations expire in 2012, when it hosts July's summit of the Group of Eight rich nations.

The Nikkei said Tokyo hoped to win support for its plan from nations receiving the yen loans.

In talks on a post-Kyoto treaty, Japan has pushed hard for a "sectoral" approach to global warming, in which each industry would have its own efficiency targets.

No immediate comment from the government on the report was available. mis/bgs

Source: Economic Times