Government targets below 5% growth in 2002

Government targets below 5% growth in 2002

JAKARTA (JP): Coordinating Minister for the Economy Dorodjatun
Kuntjoro-Jakti said on Thursday that the government was targeting
gross domestic product (GDP) growth of just below 5 percent in
the next fiscal year.

"In discussing the assumption of the state budget, we estimate
it will be difficult to achieve economic growth above 5 percent
next year," Dorodjatun said after a Cabinet meeting.

This year's growth is targeted at 3.5 percent.

He said the government wanted to achieve higher economic
growth so that it could create more job opportunities and revive
investor confidence in the country's economy.

Dorodjatun said Indonesia had to also improve its credit
rating from non-investment grade (ccc+) to investment grade
(bbb+) if it wanted to draw more foreign investment.

"Hopefully, we can improve the rating within the next three to
six months," said Dorodjatun, who was accompanied by Coordinating
Minister for Peoples' Welfare Jusuf Kalla and Minister of Foreign
Affairs Hassan Wirayuda.

Dorodjatun said the government would do its best to control
the inflation rate. "Ideally, it (the inflation rate) should be
below 10 percent."

Inflation is currently sitting at 13 percent year-on-year.

Dorodjatun said the Cabinet meeting also discussed possible
ways on how the budget could allow the government to adjust
fiscal and monetary policies.

The government, according to Dorodjatun, would continue
working to cut the country's budget deficit in order to reduce
its dependency on sovereign loans.

Separately, Minister of Finance Boediono said on Thursday that
the government was considering a stronger rupiah exchange rate of
between Rp 8,000 and Rp 9,000 to the U.S. dollar for the 2002
budget, compared to Rp 9,600 set for the 2001 budget.

The government is scheduled to present economic assumptions
for the 2002 state budget in early September. (dja/03)