2004 budget targets achievable: Burhanuddin<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
Bank Indonesia Governor Burhanuddin Abdullah said the monetary
\ntargets set out in the 2004 state budget draft were achievable
\ndespite the potential problems during the election year.<\/p>\n
Burhanuddin told reporters on Tuesday that "the economic
\ndevelopments overseas and at home bode well for us to achieve
\nthose targets."<\/p>\n
Under the budget bill, which was presented by the government
\nto the House of Representatives last week, inflation is targeted
\nto average 7 percent, the average exchange rate of the rupiah at
\n8,700 per dollar and Bank Indonesia three-month interest rates at
\n9 percent.<\/p>\n
The inflation target is seen as conservative, especially when
\ntaking into account recent optimism of Bank Indonesia to keep the
\nrate by year-end at a range of 5 to 6 percent.<\/p>\n
But, Burhanuddin claimed that the target was based on various
\naffecting factors.<\/p>\n
"The 2004 inflation (target) is projected to be higher than
\nthis year's. The consideration is based on the projected economic
\nsituation during the year, as well as aiming to maintain economic
\nstability to ensure sustainable development," he said.<\/p>\n
He did not elaborate, but analysts have suggested that next
\nyear should be a test for the government in retaining the
\nthe current macroeconomic stability, as the country will brace
\nfor general elections, also at a time when it will no longer have
\nthe full backing of the International Monetary Fund.<\/p>\n
Those circumstances are expected to put the rupiah under
\npressure, which could well threaten the current positive trend of
\ninflation.<\/p>\n
Moreover, the elections will probably provide extra
\ninflationary pressure, as political parties are expected to spend
\nhuge sums of money to win support, a move that could increase
\nmoney in circulation.<\/p>\n
Based on those considerations, the relatively conservative
\ntarget for inflation should be reasonable.<\/p>\n
Elsewhere, commenting on the economic target of 5 percent
\noverall growth, Burhanuddin was also optimistic it would be
\nwithin reach, betting on the improving global economy, which
\nwould in turn boost exports and foreign investment.<\/p>\n
"If we can maintain the stability, especially in terms of
\nsecurity as well as legal certainty, foreign investment will
\neventually come. I am optimistic all (the economic assumptions)
\ncan be met," he added.<\/p>\n
Other assumptions on the budget include the country's daily
\noil output of 1.15 million barrels per day, with the price
\nestimated at US$21 per barrel.<\/p>\n
The government and legislators are expected to soon start the
\ndebate on the budget, in which all the figures remain subject to
\nchange.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/2004-budget-targets-achievable-burhanuddin-1447893297",
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