{
    "success": true,
    "data": {
        "id": 1611931,
        "msgid": "worst-case-war-scenario-airlangga-warns-state-budget-deficit-could-hit-4-per-cent-1773417268",
        "date": "2026-03-13 22:13:10",
        "title": "Worst-Case War Scenario: Airlangga Warns State Budget Deficit Could Hit 4 Per Cent",
        "author": "Ahmad Fikri Noor",
        "source": "REPUBLIKA",
        "tags": "",
        "topic": "Finance",
        "summary": "Coordinating Minister for Economic Affairs Airlangga Hartarto has outlined three scenarios regarding the impact of a prolonged Iran-Israel-US conflict on Indonesia's state finances. In the worst-case scenario with oil prices at $115 per barrel and the rupiah at Rp 17,500 per dollar, the state budget deficit could reach 4.06 per cent of GDP, whilst more moderate scenarios project deficits of 3.18 and 3.53 per cent respectively. Airlangga cautioned that maintaining a 3 per cent deficit would require spending cuts and economic growth restraint.",
        "content": "<p>Coordinating Minister for Economic Affairs Airlangga Hartarto has\noutlined the worst-case scenario impacts of conflict between Iran\nagainst Israel and the United States on Indonesia\u2019s state finances,\nparticularly highlighting how the state budget deficit could reach 4.06\nper cent of GDP.<\/p>\n<p>During a Full Cabinet Meeting at the State Palace in Jakarta on\nFriday, 13 March 2026, Airlangga presented three scenarios should the\nconflict persist for six to ten months.<\/p>\n<p>\u201cIn the worst-case, pessimistic scenario, with crude oil prices at\n$115 per barrel, our rupiah exchange rate at Rp 17,500 per dollar,\ngrowth at 5.2 per cent, and state securities yield at 7.2 per cent, the\ndeficit reaches 4.06 per cent,\u201d Airlangga told President Prabowo during\nthe Full Cabinet Meeting.<\/p>\n<p>Airlangga also reported two additional, relatively more moderate\nscenarios, though the state budget deficit in these cases is also\nassumed to exceed 3 per cent. The assumptions include crude oil prices\nat $90 per barrel should conflict last five months, $97 per barrel for\nsix months, and $115 per barrel for ten months.<\/p>\n<p>\u201cWhen we factor this into our current state budget, here are the\nscenarios. In the first scenario, crude oil prices at $86 per barrel,\nexchange rate at Rp 17,000, with our current budget exchange rate at Rp\n16,500, and maintaining our growth rate at 5.3 per cent. State\nsecurities yield would be higher at 6.8 per cent, resulting in a deficit\nof 3.18 per cent,\u201d Airlangga said whilst presenting the first\nscenario.<\/p>\n<p>In the second scenario, domestic crude oil prices are projected at\n$97 per barrel, rupiah exchange rate at Rp 17,300 per dollar, growth\nprojected at 5.2 per cent, and state securities yield at 7.2 per cent.\nUnder these assumptions, the state budget deficit reaches 3.53 per\ncent.<\/p>\n<p>\u201cMaintaining a 3 per cent deficit is difficult for us unless we are\nwilling to cut spending and reduce growth. These are scenarios we may\nneed to discuss in limited sessions,\u201d Airlangga told Prabowo.<\/p>",
        "url": "https:\/\/jawawa.id\/newsitem\/worst-case-war-scenario-airlangga-warns-state-budget-deficit-could-hit-4-per-cent-1773417268",
        "image": ""
    },
    "sponsor": "Okusi Associates",
    "sponsor_url": "https:\/\/okusiassociates.com"
}