Budget deficit of 2.5 percent of GDP relevant to times

Budget deficit of 2.5 percent of GDP relevant to times

Finance Minister Sri Mulyani Indrawati announced the second round of stimulus package to mitigate the impact of COVID-19 in Jakarta on Friday. ANTARA FOTO/Muhammad Adimaja/foc.

We have considered all possibilities including the budget deficit that may widen to 2.5 percent
Jakarta (ANTARA) - The policy to widen the budget deficit to 2.5 percent of the national gross domestic product (GDP) is relevant to the latest developments, according to Finance Minister Sri Mulyani Indrawati.

"We have taken into account all possibilities, including the budget deficit, which may widen to 2.5 percent," she remarked during a press conference, here on Friday.

The 0.8-percent hike in the budget deficit from the initially targeted 1.76 percent to 2.5 percent of the GDP is the outcome of the government's effort to mitigate the spread of COVID-19, she noted.

With the budget deficit projected to reach 2.5 percent of the GDP, the budget deficit will widen to Rp432 trillion that will potentially add to financing.

After all, the policy to push the budget and maintain the people's purchasing power has taken into account the latest developments in the handling of coronavirus in China, the United States, and Europe, she stated.

"We have taken into account all scenarios as a precautionary measure against a budget deficit hike. We will safeguard the financing properly and reasonably," she stated.

The government can issue another stimulus policy to boost the domestic economic resilience, she noted.

The policy is quite likely since the country has passed the soft scenario. Moreover, China is expected to witness economic recession for two quarters, she remarked.

"The pandemic situation entails great risk. We continue to respond to it. This is not the last announcement of the policy since the developments and situation are quite dynamic," she added.
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