Jakarta, CNBC Indonesia – The Indonesian economy continues to show positive growth. The Central Statistics Agency (BPS) noted that the Indonesian economy was able to grow high in the second quarter of 2023 at 5.17% (yoy), above market analysts’ estimates.
RI has successfully maintained this growth trend for 7 consecutive quarters. Indonesia also succeeded in returning the budget deficit to a level below 3%, earlier than the target.
This neat achievement even stunned the international community. They are the International Monetary Fund (IMF) and the World Bank. This was revealed directly by Deputy Minister of Finance Suahasil Nazara.
According to him, Indonesia’s success was highlighted by the world and received praise from the IMF and World Bank. Moreover, at the Asean Summit which was successfully held, many parties also considered that the Indonesian economy gave hope in a world full of pressure.
“The IMF came to praise, the World Bank came to praise Indonesia,” he said, at the Working Meeting of Committee IV DPD RI at the DPR Parliament Complex, quoted on Sunday (10/9/2023).
He added that Indonesia was considered to have implemented the right economic policies during the Covid-19 pandemic, so that it could recover more quickly than other countries. “Many other countries still have deficits and have not been able to recover, Indonesia is faster,” he explained.
The government’s efforts, he continued, to maintain the economy during the pandemic are not easy. The pandemic is not the only condition that threatens the country’s economy. The condition of global uncertainty is also an additional threat that the government must face so that the Indonesian economy can survive.
The condition of global uncertainty was haunted by the outbreak of the Russia-Ukraine war in early 2022. The government also had to think carefully so that Indonesia was not affected by high world economic fluctuations. Therefore, he said, the government chose to implement a counter cyclical policy to deal with these shocks.
In its implementation, the government carried out countercyclical by adopting policies in the State Revenue and Expenditure Budget (APBN) that are contrary to economic conditions.
He gave the example that this policy was implemented at the start of the pandemic in 2020. When the economy was in decline due to the pandemic, he said, the APBN was actually designed to record a deficit of minus 6.1%.
The widened deficit limit was permitted through the ratification of Law Number 2 of 2020 concerning State Financial Policy and Financial System Stability for Handling the 2019 Corona Virus Disease (COVID-19) Pandemic.
The government took the opposite APBN policy, he said, when the pandemic conditions had begun to subside and the economy had begun to recover.
Suahasil said that large deficit policies such as during a pandemic certainly cannot be maintained continuously. Therefore, since 2022 the government has started to reduce the deficit in the APBN.
Suahasil claims that this series of policies has proven effective in treating Indonesia’s bleeding economic condition. The proof, he said, is that in 2022 the government has succeeded in reducing the APBN deficit to 2.4% of Gross Domestic Product.
“This is faster than the law mandates that our deficit must return no later than 2023,” he concluded.
Like the IMF & WB, Sri Mulyani is worried about the world situation