Airlangga: APBN Becomes the Government's Tool to Calm Price Volatility During War
THE GOVERNMENT has prepared the state budget (APBN) as a buffer to dampen price volatility amid global uncertainty caused by the Middle East war. Coordinating Minister for Economic Affairs Airlangga Hartarto said the government would maintain subsidy policies to curb the impact of rising commodity prices on the public.
He said the APBN has been prepared as a buffer to stabilise prices if there is a surge in commodities in the global market. On the other hand, price increases in commodities may also boost state revenue. However, the government believes it is still too early to draw conclusions about the impact of the conflict on the economy.
‘For Indonesia there are two sides. On one hand, with regard to subsidies, we will maintain them, and the government yesterday prepared that subsidies will be continued and the APBN is a buffer to dampen price fluctuations,’ Airlangga said in Jakarta, on Thursday (5/3).
He added that Indonesia previously faced a similar situation when a war led to a surge in energy and commodity prices globally. At that time, oil prices and various commodities rose sharply, but the government remained committed to maintaining domestic economic stability.
On the other hand, price increases in commodities can also provide additional revenue for the state. Yet the government continues to monitor global developments before drawing further conclusions.
‘But on the other hand there is indeed additional revenue if commodities rise. But we are looking at the situation; it is still too early to call (terlalu dini), still too early,’ he concluded.
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