Indonesia’s parliament approves 2023 fiscal budget

JAKARTA (Reuters) – Indonesia’s parliament on Thursday approved President Joko Widodo’s 3,061.2 trillion rupiah ($200.73 billion) budget for next year, with a fiscal deficit of 2.84% of gross domestic product, the deputy house speaker Rachmat Gobel said.

The 2023 budget aims to consolidate fiscal positions after the deficit was allowed to stretch beyond a legally-mandated 3% ceiling in the last three years for emergency response to the pandemic.

Indonesia’s economic growth and inflation targets for next year were set at 5.3% and 3.6%, respectively. Total revenues were approved at 2,463 trillion rupiah, slightly higher than proposed by the president last month at 2,443.6 trillion rupiah.

Southeast Asia’s largest economy has been recording a trade surplus every month since May, 2020, on the back of strong commodity exports and the government expects to end this year with growth of about 5%.

Bank Danamon economist Irman Faiz said that spending and revenue targets were “realistic”, but inflation could be higher than 4% due to ongoing disruptions in global supply chains.

($1 = 15,250.0000 rupiah)

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