Indonesia said yesterday that it had signed its latest agreement with the IMF and begun to undertake reforms prescribed by the fund to help revive the ailing economy.

The signing paves the way for the possible release of a second instalment of $3 billion from the International Monetary Fund's $40 billion bailout package for Indonesia.

The IMF postponed the second disbursement in March following Jakarta's failure to implement the reforms outlined in the second agreement signed by Indonesian President Suharto on January 15th.