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Text your say: Fuel-price hike
Your comments on the announcement by President Joko âJokowiâ Widodo about an increase in the prices of subsidized fuels â from Rp 6,500 (53 US cents) to Rp 8,500 for premium gasoline and from Rp 5,500 to Rp 7,500 for diesel fuel:The savings should be used to fix roads
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strong>Your comments on the announcement by President Joko 'Jokowi' Widodo about an increase in the prices of subsidized fuels ' from Rp 6,500 (53 US cents) to Rp 8,500 for premium gasoline and from Rp 5,500 to Rp 7,500 for diesel fuel:
The savings should be used to fix roads. We are lucky that fuel is still 69 US cents, as overseas fuel can be 150 percent more expensive.
Batik
It is a good decision to balance the government budget, but only if the government can increase tax revenue and only if the price of oil keeps falling. But it's not good for the poor; it will push up the already-high inflation rate even further, drive up the cost of labor and hurt exports, not to mention the trend of the strengthening dollar, the slow recovery of the global economy and the recession in Japan that will increase our inflation even more.
What is the next move? A tax hike may be an option or the government may borrow more.
Reallocating the subsidized fuel funds toward infrastructure?
It is not likely to be implemented and there is not enough support for the infrastructure program unless funds from China and Japan and foreign companies are allowed in to finance schemes and public-private partnerships (PPP).
The problem is that the Jokowi government doesn't like the PPP scheme to fund the infrastructure, as we have just witnessed when it shelved the Sunda Strait Bridge project.
Dtt van Man
The fuel-price hike transforms about Rp 120 trillion of consumptive fuel subsidies into funds to finance construction of infrastructure like roads, transportation, dams, irrigation facilities, flood prevention and energy supply.
Some funds shall be allocated to support the poor through the three social cards, one of which provides cash disbursements to poor families. It is an everlasting task of the administration to prevent cash going to the wrong purses.
The time limit of two or three years to materialize these idealistic programs seems too ambitious.
Soebagjo Soetadji
Jakarta
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