Govt to reduce need for foreign loans: Vice Minister

Indonesia will reduce its need for foreign loans by preferring to meet its financing requirements by the issuance of state debentures, National Dvelopment Planning Vice Minister Lukita Dinarsyah Tuwo said.

Although there were indications Indonesia`s foreign debts would still increase because of a budget deficit, the government had n committed to lessen its need for foreign loans and encourage domestic financing through state debentures (SUN), Lukita said here Friday.

"Due to the state budget deficit foreign debts are expected to rise but in terms of ratio it will drop. In terms of foreign debt we are committed to reducing our foreign debt stock. We will proritize debts from state debentures issued at home or abroad although the majority will certainly be issued at home in the form of state debentures and shariah bonds," he said.

He said by reducing foreign debts in the budget financing the ratio of debts to gross domestic product was expected to drop quicker.

"In terms of ratio the foreign debts will drop faster as we have been committed to limit the debts," he said.

He said with the deficit to drop from 1.6 percent to 1.2 percent in 2014 it was expected the country`s debt ratio to the gross domestic product would drop drom around 30 percent in 2009 to 24 percent in 2014.

"So, every year it drops by one percent," he said.

He said the government expected a 5.5 percent growth in 2010 and up to seven percent in 2012 and "in 2014 the growth is expected to reach above seven percent."

He said the government would strive to return the source of growth to processing industries and agriculture which are expected to contribute an average 3.6 to 3.7 percent to growth.

With regard to inflation he said it was expected to reach around 5.o to 6.0 percent while the rate of poverty to drop to 8.0 to 10 percent and unemployment 5.0 to 6.0 percent in 2014, he said. (*)

Sources :

http://www.antara.co.id/en/news/1264205120/govt-to-reduce-need-for-foreign-loans-vice-minister

http://tempe.files.wordpress.com/2009/06/boediono1.jpeg

Minister: 100-day program almost completely ready

The government`s first 100-day program in the economic field is running smoothly and almost 100 percent accomplished, Coordinating Minister for Economic Affairs Hatta Rajasa said here on Tuesday.

"No hindrances at all in the process of the program and therefore it is almost 100 percent realized," Hatta Rajasa said after a coordination meeting at his office.

But according to Hatta, the problem was that a lot of infrastructure programs were not in accordance with the site plans and forestry regulations.

Therefore, he said, the government would try to complete the revision of two presidential decrees to overcome the problem, namely the presidential decrees on government partnership with private parties, on land provision.

"With those two decrees, development will be managed in ways that accord with the site plans and do not damage forests," Hatta said, adding that if a forest area had to be developed, there would be a good way out.

He said that based on the revised Presidential Decree on land provision, a forest area could be converted into land for other purposes if the compensation was twice as much as the amount of the forest area concerned.


source :
http://www.antara.co.id/en/news/1263290112/minister-100-day-program-almost-completely-ready
http://www.vhrmedia.com/2008/ngadimin/dir_upload/images/Foto%20Yudhoyono%20Pidato-Setneg.jpg

Free trade to affect Indonesian industries

University of Indonesia (UI) economic analyst Ninasapti Triaswasti said the ASEAN-China Free Trade Area (ACFTA) effective January 1,2010 would affect certain industrial sectors in Indonesia.

"Certain industrial sectors such as garments and footwear industries are likely to be affected by the free trade area," she said in a discussion on the fate of local industries in the face of the ACFTA system here over the weekend.

She said available data showed that over the past five years. industrial product exports had continued to decline and the implementation of the ACFTA would affect industries and workers.

After all, garment and footwear industries were labor-intensive industries which provided jobs for and improved the welfare of a large number of workers.

With the ACFTA, Chinese products, which are cheaper, would flood Indonesia`s domestic market. "The influx of Chinese products could threaten local industries whose products are more expensive," she said.

She said the government could take precautionary steps such as delaying the implementation of the free trade for certain industrial products which were not yet ready to compete.

The economic analyst said that the Indonesian government signed the ACFTA agreement in 2002 but it had not prepared the domestic industries to face it.



Source :
http://www.antara.co.id/en/news/1263219156/free-trade-to-affect-indonesian-industries
http://www.nicholsoncartoons.com.au/cartoons/new/2002-11-16%20Free%20trade%20agriculture%20subsidies%20WTO%20protest%201m.JPG

President asks govt agencies to implement budgets promptly

President Susilo Bambang Yudhoyono has reminded all administrative authorities to implement their work programs in 2010 and not to postpone implementation of their budgets.

President Susilo Bambang Yudhoyono made the statement here on Tuesday when handing over a List of Approved Projects (DIPA) 2010 to ministries and departments as well as regional administrations.

All regulations on budget disbursement and policies on goods and services procurement were available, the head of state said.

Therefore, there was no excuse for postponing the implementation of budgets, he said.

The head of state presented the DIPAs from the 2010 State Budget at the State Palace at a ceremony attended by Vice President Boediono, all cabinet ministers and 33 provincial governors from across the country.

The government is expected to allocate funds from the 2010 State Budget amounting to Rp1,047.7 trillion or 15.5 percent of the Gross Domestic Product.

The allocation of state budget funds for the central government is estimated at Rp725.2 trillion or 12.1 percent from the state budget, or up Rp79.8 trillion or 12.4 percent from Rp645.4 trillion in the 2009 state budget.

"The larger state budget should be spent as best as possible for the improvement of the people`s welfare," the president said.

Among government institutions and ministries receiving the largest amounts of DIPA funds totaling Rp340.1 trillion were the defense ministry (Rp42.3 trillion), the national education ministry (Rp55.2 trillion), the public works ministry (Rp34.8 trillion) , the religious affairs ministry (Rp27.2 trillion), the national police (Rp27.2 trillion) and the health ministry (Rp21.4 trillion). The transportation ministry (Rp15.8 trillion).

The president on the occasion presented DIPA funds to National Education Minister M Nuh for the 2010 budget for national education, and to Defense Minister Purnomo Yusgiantoro and Finance Minister Sri Mulyani Indrawati as the state`s general treasurer.

The 33 governors would also receive DIPA funds from President Yudhoyono for their 2010 regional budgets.(*)


Source :
http://www.antara.co.id/en/news/1262733478/president-asks-govt-agencies-to-implement-budgets-promptly
http://danisugiri.files.wordpress.com/2009/04/budget_1918.jpg

SBY eyes 6.6% average annual growth rate

Indonesia’s economy may grow by an average annual rate of 6.6 percent over the next five years and reach 7 percent by the end of 2014, President Susilo Bambang Yudhoyono said at the opening of the first trading day in 2010 of the Indonesia Stock Exchange.
In his second five-year term Yudhoyono plans by 2014 to have the unemployment rate fall to between 5 and 6 percent from 8 percent currently, and to reduce the poverty rate to between 8 and 10 percent from 14.2 percent.
Yudhoyono said the Indonesian economy showed all the favorable conditions required to attain 7 percent growth by 2014 as long as there was economic and political stability.
A key contributing factor to  economic stability, he said, was to have strong foreign currency reserves.
“We now have only US$65 billion [in foreign currency reserves]. This must be increased in line with our volume of trading,” Yudhoyono said, announcing a target of US$100 billion for currency reserves by 2014.
Yudhoyono also lauded the performance of the IDX in 2009, which had emerged as the second best performer in Asia with a growth of 86.98 percent.
“I really thank and appreciate all the parties who have been working hard last year,” Yudhoyono said, following  which he pressed the button to start this year’s  trading.
The IDX is expected to be among the markets that will remain bullish this year due to the country’s strong economic fundamentals at a time when many economies are still suffering from recession.
The IDX closed the day with a rise of 41.06 points or 1.6 percent to stand at 2,575.41, the steepest increase since Nov.16, Bloomberg reported.
Finance Minister Sri Mulyani Indrawati said that stock market positive performance was achieved due to the government’s responsive actions to cushion the impacts of the global economic downturn.
Mulyani said the government’s measures in handling the crisis last year had succeeded in maintaining market confidence.
“As a result, we experienced a stable economy in 2009 which placed Indonesia as one of the very few countries in the world which were able to post positive growth despite the [global] crisis,” she said.
Indonesian economic conditions are stabilizing after the market collapse and turbulence as a result of the global financial crisis, which reached its peak by the end of 2008. The inflation rate in 2009 reached 2.78 percent year-on-year in December, the lowest inflation rate in a decade, while the rupiah remained stable at between Rp 9,400 and Rp 9,600 to the US dollar.
Low inflation may give the BI room to keep its benchmark interest rate at a record-low 6.5 percent when policy makers meet on Wednesday.
Chatib Basri, an adviser to the finance minister said the inflation rate was likely to reach 6 to 7 percent in 2010 assuming the rupiah remained stable at 9,800 to the dollar.
The economy would receive a boost from the expected rebound in exports which were expected to recover from a 15 percent fall in 2009 by the middle of the year, he said.
“Exports have begun to recover but still at a slow pace. The global economic crisis has eased but it will take time to impact on investment and export rates,” Chatib said.
Unlike exports, the investment rate has already regained ground and demonstrated positive growth.
“Investment is already going up, albeit slowly,” he said.

Source : 
http://www.thejakartapost.com/news/2010/01/05/sby-eyes-66-average-annual-growth-rate.html