JAKARTA: Indonesia’s budget deficit this year is estimated at 2.7 per cent of gross domestic product, higher than the government’s 2.29 per cent target, as state spending is expected to increase due to the rupiah’s depreciation, its finance minister said on Monday ( Jul 8 ).
The ringgit hit 16, 475 per US money last month, its weakest in four years, due to a solid dollar and on worry about the saving programs of the approaching government. In the first half of the time, it has fallen by about 6.3 %.
Finance Minister Sri Mulyani Indrawati stated that the government will continue to monitor its debt control and make the best use of the surplus cash from the previous year’s budget. However, the president’s saving on fuel subsidies has increased as a result of the weaker ringgit.
The government will use around 100 trillion rupiah ( US$ 6.15 billion ) excess from last year to reduce debt issuance this year, she said.
She told the parliamentary budget council,” Maybe this will help maintain economic stability, particularly the exchange rate movements and government bond yields.”
According to data presented at the hearing, the federal posted a fiscal deficit of 0.34 percent for the first six weeks of 2024.
Said Abdullah, the council head, warned the government about the risk of lower taxes earnings this year and suggested that it put on hold tasks that had a smaller effect on economic , development.