We must remain very selective because the state budget deficit is not without consequences
Jakarta (ANTARA) - Indonesia's current economic recovery was still going strong, albeit relatively fast state budget deficit consolidation following an increase in the gross domestic product of above three percent due to the pandemic, the finance minister stated.

Therefore, the state budget deficit was targeted to fall to below the level of three percent of the gross domestic product, or precisely 2.85 percent, in 2023.

"We must remain very selective because the state budget deficit is not without consequences," Finance Minister Sri Mulyani Indrawati remarked at the 100 Indonesian Economist Workshop on Wednesday.

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Hence, the government has exercised caution in using the budget deficit instrument and employing careful and wise considerations so as not to cause turmoil.

In 2023, state spending would not be as much as that in 2021 and 2022 during which allocations were extensively made for COVID-19 handling, such as hospital bills and health incentives, so that it would support the consolidation of the state budget deficit, the minister stated.

In the 2023 state budget posture, Rp3,041.7 trillion of the state spending was allocated, down from Rp3,106.4 trillion in 2022.

Moreover, energy subsidies would also be reduced next year, from Rp500 trillion this year to around Rp340 trillion.

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Next year's infrastructure development spending would only be allocated to the project that would be completed in 2023 and early 2024, so it would be reduced from this year.

"This was in accordance with the mandate of the president," she pointed out.

The minister reminded that the budget for social spending next year would be maintained and also for education and health spending, both of which would continue to be increased.

For instance, the education budget allocation reached around Rp500 trillion last year, while in 2023, it increased to Rp600 trillion.

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Translator: Agatha O V, Mecca Yumna
Editor: Fardah Assegaf
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