Boediono defends ambitious growth target for 2003<\/p>\n
Dadan Wijaksana, The Jakarta Post, Jakarta<\/p>\n
The government defended on Wednesday its ambitious economic
\ngrowth target of 5 percent for 2003, saying consumption would
\nremain robust, while the global economic recovery would improve
\nthe country's performance in exports and investment.<\/p>\n
Minister of Finance Boediono told legislators during a plenary
\nsession with the House of Representatives that the growth target
\nwas based on better expectations of economic and non-economic
\nfactors, both at home and overseas.<\/p>\n
\"Generally, the economic target assumption of 5 percent for
\n2003 is realistic.<\/p>\n
\"Consumption will still comprise the largest part of
\n(growth) ... while the role of investment and exports will
\nincrease as well,\" Boediono said during the session.<\/p>\n
The session marks the early stages of the debate of the draft
\n2003 state budget.<\/p>\n
The draft, presented to the House two weeks ago, assumes an
\neconomic growth of five percent. Analysts have described the
\nfigure as too ambitious given the current unfavorable conditions.<\/p>\n
Last week, also during a House session, most of the ten
\nfactions of the House cast doubt on the assumption as the country
\nwas experiencing slumps in several economic areas.<\/p>\n
The criticism centers mostly on the fact that the performance
\nin exports and investment has so far been less than encouraging.<\/p>\n
Throughout the first half, domestic and foreign direct
\ninvestments dropped by 68 percent and 42 percent respectively
\ncompared to the same period last year, while exports were down by
\n6.7 percent in the same period.<\/p>\n
Against this backdrop -- they argued -- it was unlikely that
\nthe 2003 target was within reach as the government could no
\nlonger bet on strong domestic consumption as the sole engine for
\ngrowth. The latest data reveals that consumption has started to
\nshow signs of slowing.<\/p>\n
In his response, while admitting that consumption was slowing
\ndown, Boediono said consumption would continue to become the
\nprime mover of next year's economic growth.<\/p>\n
\"It is slowing down, but it will remain strong on consumers'
\nexpectations of an improved economic and earning prospects,\" he
\nsaid, adding that consumption made up 80 percent of the country's
\ngross domestic product (GDP).<\/p>\n
In the meantime, while exports were expected to pick up in
\naccordance with recovery in the world's economy, investment would
\nalso make a greater contribution to overall growth triggered by a
\nmore conducive climate in line with better political and security
\nconditions here, he said.<\/p>\n
\"We expect investment to rise from the expected 4.8 percent
\nthis year to 7.6 percent in 2003, while exports will climb from
\nan expected 4.7 percent in 2002 to 5.8 percent in 2003,\" Boediono
\nadded.<\/p>\n
To achieve a more favorable climate, the government would
\npress ahead with its various programs, including finalizing the
\ndraft law on investments.<\/p>\n
Boediono said other efforts included maintaining and improving
\nsocial, political and security conditions and also strengthening
\nthe justice system.<\/p>\n
On the external front, Boediono expected the international
\nrecovery would increase the global trading volume growth from 2.5
\npercent to 6.6 percent in 2003.<\/p>\n
\"This would give us the potential to improve exports and
\ninvestment performance, so it augurs well for accelerating the
\ncountry's economic recovery,\" he said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/boediono-defends-ambitious-growth-target-for-2003-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}