"I estimate that the spending allocation will be higher and the additional impact on consumption will also be higher," she said during a virtual discussion held by the Asian Development Bank (ADB) here on Wednesday.
In contrast to previous elections, the 2024 election is predicted to have a more positive impact on the economy because of its wider coverage, she observed.
Indonesia will hold presidential, legislative, and regional head elections simultaneously in 2024.
According to Yustina, the previous election only had a slight positive impact on consumption growth due to the global crisis, which, at the time, hampered overall economic growth.
"We (at the time) were experiencing a trade war, Taper Tantrum, as well as turmoil during the previous election (in 2019), so there were various impacts globally," she said.
The term Taper Tantrum refers to a period of economic turbulence that occurred in 2013 when the US Federal Reserve announced its future intention to tighten or taper its monetary policy.
Furthermore, Yustina said she believes that the elections could also potentially affect investment.
During the previous elections, Indonesia's investment rate was hampered slightly due to investors tending to wait for a conducive situation.
It is possible that such a scenario could be repeated in 2024, she said. She added that in the first half of 2023, she did not see any increase in the investment sector.
However, approaching the third quarter of 2023, there has been an increase in credit and savings growth.
"There are many clear reasons, one of which is the lack of funding, which affects trade performance and the lack of growth potential entering the domestic market," Yustina said.
During the discussion, she projected that Indonesia's economic growth would reach 5.04 percent this year and 5.1 percent in 2024.
During the same discussion, an expert for industry and international trade at the Indonesian Ministry of Finance, Kiki Verico, said that the 2024 election would have a positive impact on the country's economy, specifically on the consumption sector.
"So, I believe that economic growth will be better. I believe that the election will run smoothly in this democratic momentum," he added.
Minister of Finance Sri Mulyani Indrawati previously pegged the total budget allocation for the general elections from 2022–2024 at Rp70.6 trillion.
The budget has been released gradually, with Rp3.1 trillion allocated in 2022, Rp30 trillion in 2023, and Rp37.4 trillion for 2024.
Indrawati explained that the realization of this year's election budget, from January to September 19, reached Rp14 trillion, or 30 percent of the budget ceiling of Rp46.7 trillion.
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Translator: Bayu Saputra, Katriana
Editor: Tia Mutiasari
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