2003 deficit under control, below target: Government<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
The government posted a state budget deficit in 2003 that was
\nslightly below target, in what Minister of Finance Boediono said
\non Friday was a reflection of the government's continued fiscal
\ndiscipline.<\/p>\n
\"In general, the 2003 budget realization was in line with the
\ngovernment's targets,\" Boediono said.<\/p>\n
The budget deficit stood at Rp 33.7 trillion (about US$400
\nmillion) last year, slightly below the original target of Rp 34.4
\ntrillion, thanks in part to the government's success in keeping
\nspending in check.<\/p>\n
The deficit accounted for 1.9 percent of gross domestic
\nproduct, which matched the target set in the state budget.<\/p>\n
Since the financial crisis struck in 1997, the annual state
\nbudget has run a deficit, the result of the huge payouts the
\ngovernment had to make to bail out the near-bankrupt banking
\nsector.<\/p>\n
No less than Rp 600 trillion was injected into the sector,
\nforcing the government to service huge annual interest payments.<\/p>\n
The budget deficits have forced the government to continue to
\nseek new loans from international donors -- a move seen to have
\ndragged the country into a deep debt trap.<\/p>\n
Friday's announcement, however, confirmed that the government
\nis on the right track in gradually lowering the deficit. In 2001,
\n2002 and 2003, the government posted deficits of 3.7 percent (of
\nGDP), 2.5 percent and 1.9 percent, respectively. The government
\nexpects to have a balanced state budget by 2006.<\/p>\n
Aside from foreign financing, other sources the country has
\nused to cover the deficit are proceeds from the sales of assets
\nunder the Indonesian Bank Restructuring Agency (IBRA) and the
\nprivatization of state-owned companies, as well as bond issues.<\/p>\n
As for this year, the government expects to continue the trend
\nby setting the deficit at Rp 24.4 trillion, or 1.2 percent of
\nGDP.<\/p>\n
There is concern, however, that the lower-than-expected
\ndeficit could be caused by the slow progress in a number of
\ndevelopment projects.<\/p>\n
Boediono also said that in 2003, the government raked in Rp
\n341.1 trillion in revenue, slightly lower than the target of Rp
\n342.8 trillion, while expenditures amounted to Rp 374.8 trillion,
\nalso below the target of Rp 372.2 trillion.<\/p>\n
The finance ministry also predicted that the economy in 2003
\nexpanded by 4.1 percent, slightly higher than the target of 4
\npercent.<\/p>\n
This was in line with the central bank's announcement a day
\nearlier that economic growth was 4 percent last year.<\/p>\n
The official calculation of the country's economic growth is
\nbeing made by the Central Statistics Agency, with the result
\nscheduled to be made public later this month.<\/p>\n
For 2004, the government is forecasting economic growth of 4.8
\npercent.<\/p>\n
Indonesia's economy needs to expand by about 6 percent to 7
\npercent annually to cut unemployment in the country. With only 4
\npercent growth, about 1.2 million new workers each year will fail
\nto find work, on top of the 40 million or so already without jobs
\nor underemployed.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/2003-deficit-under-control-below-target-government-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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