ASIATODAY.ID, JAKARTA – Minister of Finance of the Republic of Indonesia, Sri Mulyani Indrawati is optimistic that Indonesia’s economic growth in 2024 can still be maintained above 5 percent.
Sri Mulyani explained several factors that support this optimism at the 2024 Indonesian Economic Outlook National Seminar forum held at the St. Regis, Jakarta on Friday, December 22 2023.
Sri said that international institutions which predicted that 2023 would be a quite dark year for the economies of a number of large countries due to the increase in interest rates did not fully come true.
“For America, there seems to be hope because of the resilience of its economy until the end of this year. “So at least the world’s largest economy can survive the extraordinary increase in interest rates,” he said.
Sri reminded Indonesia to remain alert in facing various dynamics occurring at the global level. The government is also trying to maintain domestic demand because consumption by the lower middle class is very large. For this reason, the government continues to strive to control inflation and rising food prices.
“That’s why the President addresses the issue of food, it becomes very important. Our various policies yesterday, whether it was for buying a house or buying a car, were all aimed at ensuring that the supply side, property and construction, had a large multiplier. “From the middle group side, we see that they still have purchasing power, they are starting to be encouraged to grow,” he explained.
On the other hand, high tax growth can also encourage future economic growth. However, Sri sees this as a critical point for Indonesia because it must maintain the growth momentum which is the tax base.
“The growth of our tax revenues this year is still 7 percent, so its quite remarkable despite the very high baseline increase. This will cause the tax ratio to improve and then we will focus on better spending, even though this is President Jokowi’s last year. “It is possible that the critical points are quality spending and speed of spending,” he explained.
Sri said that high and sustainable economic growth must also be driven by productivity through improving infrastructure and the quality of Indonesia’s human resources. Apart from that, he assessed that the State Revenue and Expenditure Budget (APBN) must also be kept healthy to withstand various shocks that will arise next year.
“During this time, the APBN, from the start of the pandemic or even before the pandemic, we have always been countercyclical and a very effective shock absorber. Certainly this can be done if the APBN is credible, healthy and strong. “That’s why, apart from issues of human resources and infrastructure for productivity, keep the APBN healthy, strong and credible,” he stressed. (AT Network)
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