Government Cannot Stop Obtaining Debt Suddenly: Minister of Finance
Date 21 Agustus 2017
Minister of Finance Sri Mulyani Indrawati thought that a deficit totaling Rp325.936 billion or 2.19 percent in the 2018 State Budget Bill, demonstrates an intention to create a healthier State Budget and to run the functions of allocation and distribution stabilization.
The decrease in this budget deficit (compared to the figure in 2017 which was 2.67 percent, and in 2016 which was 2.49 percent), the Minister added, also shows the efforts to solve debt problems and primary balance so they will not burden the State Budget.With a lower deficit, the concern of debt can be solved. However, the Government cannot just stop obtaining debt suddenly. Primary balance is still positive but it decreased by half compared to 2017, Sri Mulyani said in a press statement, at the Ministry of Finance, Jakarta, on Monday (21/8) afternoon.
For the record, the Government has set a target of state revenue of 2018 totaling Rp1,878,447.3 billion, consisting of tax revenue amounting to Rp1,609,383.3 billion, non-tax state revenue Rp267,867.1 billion, and grant revenue Rp1,196.9 billion.
Meanwhile, the state expenditure in 2018 is projected to reach Rp2,204,383.9 billion, consisting of Central Government expenditure totaling Rp1,443,296.4 billion and transfers to region as well as village fund totaling Rp761,087.5 billion.
Based on the estimated policies of state revenue and expenditure, budget deficit is projected to reach Rp325,936.6 billion that will be closed with budget financing sourced from domestic and foreign debt.
Minister of Finance Sri Mulyani Indrawati said that the target of budget deficit that lower than the 2016 and 2017 periods shall give a message to the people that the trend of the current financing is healthier. It shows that we are very careful in making a design so Indonesia can avoid debt crisis that happens in many developed countries, Sri Mulyani said.
The Minister explained that the strategies of Governments debt financing in 2018 are, among others, to increase the efficiency of debt cost, to optimize the facility of cash loan, to encourage communitys role in obligation market and to manage foreign loan selectively.
She believes that the Government will be prudent to maintain debt ratio in the range of 27-29 percent to GDP and to use the debt only for productive activities such as infrastructures. (ANT/ES)(MMB/YM/Naster)