Without raising its budget spendings, the government would have difficulty achieving an economic growth rate of 7 percent this year, Irfan Kurniawan said here on Monday.
Irfan who is also chief analyst with PT First Asia Capital said the government should also be able to boost investment inflows and encourage exports to grow more than 25 percent.
He said household consumption which had so far contributed the most to the economic growth tended to stagnate, reaching 55 percent.
The government`s budget spending in the first quarter of 2011 reached 6.8 percent compared to 12 percent in the same period last year, he said.
To achieve the economic growth target of 7 percent the government should raise its budget spending to up to 15 percent, he said.
He said the chance of achieving the economic growth target of 7 percent was still open particularly after the Investment Coordinating Board (BKPM) had projected domestic and foreign investments to grow by 15 percent and 20 percent respectively.
The target represented a significant increase compared to the same period last year when the investment target was 8.5 percent, he said.
The household consumption was also expected to rebound ahead of post-fasting month festivities Lebaran, he said.
(SYS/S012/H-YH)
Editor: Suryanto
Copyright © ANTARA 2011
