Indonesia's president vowed Thursday to slash the nation's budget deficit to 1.6 percent in 2013, unveiling a draft spending plan to maintain the economy's resilience to uncertain global conditions.
In a speech to parliament, Yudhoyono pledged to rein in the budget deficit from 2.23 percent expected for 2012, with revenues expected to hike 11 percent to 1,507.7 trillion rupiah ($158.3 billion).
The spending ceiling would be set at 1,657.9 trillion rupiah, he said, and the infrastructure budget would rise "significantly".
Subsidies will increase by 48 trillion rupiah and make up 18 percent of the budget, the vast majority going toward oil and gas.
"In 2011, a time when other countries slowed or even experienced negative growth, we were able to achieve economic growth of 6.5 percent," Yudhoyono said, adding he expected 2012 growth to reach between 6.3 and 6.5 percent.
"But uncertainty in global economic and financial developments can affect economic growth and national development, both directly and indirectly," he said.
"So we must continue to follow and be aware of developments in the global economic conditions day by day."
Indonesia has resisted the external shocks of the eurozone debt crisis and a slump in the United States, with robust domestic demand in the nation of 240 million buffering the economy, Southeast Asia's largest.
The draft budget was based on assumptions of economic growth of 6.8 percent and inflation of 4.9 percent in 2013, alongside other indicators. Second-quarter growth this year sped to 6.4 percent, while on-year inflation in July was 4.56 percent.
"The government will continue to make inflation control a priority in macroeconomic policy," he said, adding the central bank could still maintain its record-low benchmark interest rate at 5.75 percent to promote growth.
Indonesia is struggling to boost its weak rupiah, among the worst-performing currencies in Asia, sliding more than six percent over a 12-month period, Yudhoyono said.
But the president brushed the rupiah's performance off as a "global phenomenon", saying most currencies were weakening against the greenback.
yahoo.com
In a speech to parliament, Yudhoyono pledged to rein in the budget deficit from 2.23 percent expected for 2012, with revenues expected to hike 11 percent to 1,507.7 trillion rupiah ($158.3 billion).
The spending ceiling would be set at 1,657.9 trillion rupiah, he said, and the infrastructure budget would rise "significantly".
Subsidies will increase by 48 trillion rupiah and make up 18 percent of the budget, the vast majority going toward oil and gas.
"In 2011, a time when other countries slowed or even experienced negative growth, we were able to achieve economic growth of 6.5 percent," Yudhoyono said, adding he expected 2012 growth to reach between 6.3 and 6.5 percent.
"But uncertainty in global economic and financial developments can affect economic growth and national development, both directly and indirectly," he said.
"So we must continue to follow and be aware of developments in the global economic conditions day by day."
Indonesia has resisted the external shocks of the eurozone debt crisis and a slump in the United States, with robust domestic demand in the nation of 240 million buffering the economy, Southeast Asia's largest.
The draft budget was based on assumptions of economic growth of 6.8 percent and inflation of 4.9 percent in 2013, alongside other indicators. Second-quarter growth this year sped to 6.4 percent, while on-year inflation in July was 4.56 percent.
"The government will continue to make inflation control a priority in macroeconomic policy," he said, adding the central bank could still maintain its record-low benchmark interest rate at 5.75 percent to promote growth.
Indonesia is struggling to boost its weak rupiah, among the worst-performing currencies in Asia, sliding more than six percent over a 12-month period, Yudhoyono said.
But the president brushed the rupiah's performance off as a "global phenomenon", saying most currencies were weakening against the greenback.
yahoo.com
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