Finance Ministry optimistic of 95% PEN stimulus absorption by year-end

Finance Ministry optimistic of 95% PEN stimulus absorption by year-end

Deputy Finance Minister Suahasil Nazara at the BeritaSatu 2022 Economic Outlook event held online in Jakarta on Monday (Nov 22, 2021). ANTARA/Agatha Olivia.

Since the government launched the PEN programme in 2020, we observed that the stimulus realisation has reached 67 percent from the total Rp744.77 trillion (around US$52.1 billion) budget limit by November 19, 2021
Jakarta (ANTARA) - Deputy Finance Minister Suahasil Nazara is optimistic of a 95-percent absorption of the National Economic Recovery (PEN) stimulus achieved by year-end as the authority recorded rapid progress in the realisation of stimulus until November 2021.

"Since the government launched the PEN programme in 2020, we observed that the stimulus realisation has reached 67 percent from the total Rp744.77 trillion (around US$52.1 billion) budget limit by November 19, 2021," Nazara stated during the Economic Outlook event held online here on Monday.

The deputy minister projects high realisation of stimulus in the healthcare field, as incomplete stimulus claims of several hospitals were expected to conclude by year-end.


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COVID-19 handling costs covered by the national government significantly increased during the COVID-19 Delta variant infection wave in mid-year that overwhelmed the Indonesian healthcare system, and the total spending during the period was apparent from the final report released at the year-end, Nazara remarked.

Nazara opined that the budget for social protection would reach the designated target of Rp135.35 trillion (around US$9.47 billion), as the cost would increase after new payments made in November and December 2021 were included in the calculation.

Meanwhile, the PEN programme stimulus for MSMEs and corporations would reach 90 percent from the Rp81.83 billion (around US$5.72 billion) budget target, as several claims for interest subsidy of the people's business credit had yet to be completed, Nazara stated.

Budget absorption for priority programmes of various ministries would see an increasing trend in the last three months of 2021, thereby pushing the absorption to reach the targeted Rp75.44 trillion (some 5.28 billion), the deputy minister remarked.

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Nazara pointed out that 99.4 percent of the PEN stimulus for business incentives had been realized by November 19 and was expected to achieve the target by year-end.

"The stimulus for business incentives is expected to surpass 100-percent absorption from the Rp62.4-trillion target (around US$4.36 billion), and we will continue to accommodate the demand from the state budget to stimulate our economic activities. We will see the absorption performance in December to determine our next step," Nazara stated.

The high stimulus realisation in business incentives provided a significant boost for economic activities despite mobility restrictions in July 2021, he added.


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