He said that the main sources of the country`s domestic financing remained to come from the issuance of SBN while foreign financing sources would come from foreign loans in the form of program and project loans.
Jakarta (ANTARA News) - President Susilo Bambang Yudhoyono said that the deficit in the state budget would be covered by state securities (SBN) and foreign loans.

"We will do it with a stable and sustainable financing and with a minimum burden and risk," the President said in his state-of-the nation address on 2012 Draft State Budget and Financial Notes before a plenary session of the House of Representatives (DPR) here on Tuesday.

He said that the main sources of the country`s domestic financing remained to come from the issuance of SBN while foreign financing sources would come from foreign loans in the form of program and project loans.

Of the steps, the president expressed hope that the debt ratio against the Gross Domestic Product (GDP) would be reduced to 24 percent in 2012 from the 25 percent in 2011.

"This is a significant decline if compared with the ratio in 2004 when it was recorded at 57 percent," the head of state said.

He said that the decline in the debt ratio against the GDP was expected to reinforce the country`s fiscal resilience structure. This is in line with the government`s goal of achieving sustainable fiscal reliance.

"This is our efforts to maintain national economic resilience," he said.

The president said that in order to maintain the fiscal continuity, the 2012 state budget deficit would be maintained at Rp125.6 trillion or 1.5 percent of the GDP.

The figure dropped by Rp25.2 trillion from the 2011 revised state budget amounting to Rp150.8 trillion or 2.1 percent of the GDP.

"We have to be thankful because we are still able to control the deficit and maintain the fiscal resilience at a time when a number of European countries are undergoing a fiscal crisis and government debt problem as a result of the increase in their deficit which exceeded 10 percent of their GDP," the head of state said.

In his address, the president also indicated that the country`s revenues and grant were set at Rp1,292.9 trillion, or up 10.5 percent from the 2011 revised state budget at Rp1,169.9 trillion.

The state expenditures were set at Rp1,418.5 trillion, up 97.7 trillion or 7.4 percent from the 2011 revised state budget which was set at 1,320.8 trillion.

Thus, the draft state budget deficit for 2012 was at Rp125.6 trillion, or 1.5 percent of the Gross Domestic Product (GDP) or lower than the deficit of the 2011 revised state budget which was set at Rp150.9 trillion.(*)

Editor: Heru Purwanto
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