Account deficit worries House<\/p>\n
JAKARTA (JP): The House of Representatives again expressed its
\nconcern over the deepening of the country's current account
\ndeficit, which it described as a structural problem of
\nIndonesia's economy which will remain a problem for years to
\ncome.<\/p>\n
\"Considering various global developments, it can be predicted
\nthat the current account deficits will remain a structural
\nproblem in our economy in the coming years,\" the House speaker,
\nWahono, said here Wednesday when closing parliamentary sessions
\nfor the current fiscal year.<\/p>\n
He recognized that the problem of account deficits is a
\ngeneral sign of a dynamic economy. However, he noted that when
\nthe deficit expands too quickly, the government has to take
\nnecessary measures to curb it.<\/p>\n
The government projects that the current account deficit may
\nincrease to US$7.9 billion for the 1995\/1996 fiscal year ending
\nthis month from $3.49 billion last fiscal year.<\/p>\n
The original estimate of the account deficit for the current
\nfiscal year was $4.05 billion.<\/p>\n
For the next fiscal year, the account deficit is projected to
\nshrink slightly to $6.87 billion.<\/p>\n
Wahono noted that factors which cause the increase of current
\naccount deficits are the continuously increasing deficit in
\nservices, especially in sea transportation and finance, and the
\ndecreasing trade surplus due to the sharp growth of imports.<\/p>\n
The government has projected that the deficit in the
\ninternational trading of services is likely to rise to $13
\nbillion this fiscal year from $11.5 billion last fiscal year. For
\nthe next fiscal year, the deficit in services is projected to
\nrise further still, to $14.67 billion.<\/p>\n
Indonesia's trade surplus fell by 41 percent to US$4.75
\nbillion last year from $8.07 billion in the previous year. Total
\nexports grew by 13.4 percent to $45.42 billion last year from
\n$40.05 billion in 1994, while last year's imports soared by 27
\npercent to $40.66 billion from $30.98 billion in 1994.<\/p>\n
Hidden costs<\/p>\n
At a plenary session earlier Wednesday, spokesman for the
\nruling Golkar faction Boy Musbar Nurmawan indicated that the
\ndecreasing trade surplus had been caused by the high imported
\ncontent of the country's export commodities as well as its high
\ncost economy, the result of both levies and the demanding of
\nbribes.<\/p>\n
\"It is imperative to develop export commodities with high
\nlocal content and market potential,\" Boy was quoted by Antara as
\nsaying.<\/p>\n
Meanwhile, spokesman for the United Development Party faction
\nSa'di Zen Noor suggested that the government closely evaluate
\nevery investment project, be it foreign or domestic, in terms of
\nits dependency on imported supplies.<\/p>\n
\"We are lucky that the flow of foreign direct investment into
\nthe country is quite high. However, such investment has driven
\nhigh imports, as investment requires imported capital goods as
\nwell as of raw and supporting materials,\" Sa'di told the plenary
\nsession.<\/p>\n
At Wednesday's plenary session, the House passed the bill on
\nthe amendment of the government's budget for the current fiscal
\nyear into law.<\/p>\n
Minister of Finance Mar'ie Muhammad explained at the session
\nthat the current budget is estimated to enjoy a surplus of Rp
\n375.3 billion (US$160 million), because revenues are estimated to
\nreach Rp 82.72 trillion, while spending is likely to reach only
\nRp 82.35 trillion.<\/p>\n
The current budget was originally envisaged to balance at Rp
\n78.02 trillion.<\/p>\n
Mar'ie explained that funds collected from domestic sources
\nwere estimated to contribute Rp 71.55 trillion to the
\ngovernment's total revenues of Rp 82.72 trillion, which indicates
\nan increase of Rp 5.9 trillion from the original budget.
\nMeanwhile, foreign revenues are projected to decline by Rp 859
\nbillion from the original budget.<\/p>\n
He said the increase in domestic revenues results from
\nunexpectedly higher tax and non-tax receipts as well as higher
\nreceipts from the oil and gas sector.<\/p>\n
Tax revenues are projected to reach Rp 48.42 trillion, 7
\npercent more than the original target; non-tax revenues are
\nestimated at Rp 7.8 trillion or 20.2 percent above the target,
\nwhile the oil and gas sector is projected to contribute Rp 14.8
\ntrillion or 11.8 percent more than the original estimate. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/account-deficit-worries-house-1447893297",
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