Jakarta (ANTARA) - President Joko Widodo (Jokowi) has directed that 40 percent of the state (APBN), regional (APBD), and state-owned enterprises (SOEs) budget be used for purchasing domestic products.

"Just use 40 percent of those budget to trigger our economic growth from central government to local government," he noted in the ‘Affirmation Act of the Proud of Indonesian Products’ in Bali on Friday.

The head of state said that the central government has a procurement budget of Rp526 trillion, while each province, city, and district government has Rp535 trillion, and SOEs have a budget of Rp420 trillion. Therefore, he asked them to allocate 40 percent of their budget spending to purchase domestic products.

If 40 percent of the budget is used for procuring domestic products, then SOE spending could boost economic growth up to 0.4 percent, while procurements through state and regional budgets could boost economic growth from 1.5 to 1.7 percent, Jokowi explained.

"We do not need to find investors; we must consistently buy goods produced by factories, industries, our micro, small, and medium enterprises (MSMEs)," he emphasized.

He also asked ministries and local governments to stop buying imported goods.

"Do we want to continue buying imported goods? No. We cannot. By buying imported goods, meaning we are giving jobs to other countries. Our money and capital outflow will go directly to other countries," he remarked.

If the ministry, regional government, and SOEs purchase domestic goods, there would be additional capital and investment by domestic entrepreneurs that could open more job opportunities, he said.

"It has been calculated, it could open up two million jobs," he added.

The President also said that not all parties have actually spent their budget on domestic products.

"We just ask 40 percent of your budget for domestic products, until May 2022. This morning I checked, it was only Rp214 trillion. If it is already at Rp400 trillion, then it is good," he said.

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The ‘Affirmation Act of the Proud of Indonesian Products’ was preceded by a business matching event for domestic product purchases on March 22-–4 2022,which resulted in deals worth Rp85 trillion.

Based on the simulation results conducted by Statistics Indonesia (BPS), purchasing domestic products worth Rp400 trillion can increase national economic growth by 1.67 to 1.71 percent.

If economic growth in Indonesia was 3.69 percent in 2021, then by maximizing the use of domestic products, the Indonesian economy can be boosted up to 5.36–5.4 percent.

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Translator: Desca Lidya N, Resinta S
Editor: Rahmad Nasution
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