In a much-anticipated move, lawmakers have thrown their weight behind a draft of the proposed 2018 state budget, paving the way for the government to soon finalize it.

The House of Representatives’ budget committee led by Aziz Syamsuddin gave a nod to the draft budget on Wednesday as it agreed on a set of underlying macroeconomic assumptions.

Such an approval paves the way for the government to refine the calculations in the draft before it is officially submitted to the plenary session on July 11 and later delivered by President Joko “Jokowi” Widodo in his annual Independence Day speech on Aug. 17.

Finance Minister Sri Mulyani Indrawati said during the day that the government had made its best effort to improve the ability of the budget to address key economic challenges.

In the past year, it tried to trim the budget in a bid to promote efficiency, such as by cutting unnecessary spending.

“We hope that the quality of the state budget becomes better each year and it can serve as an instrument to solve our structural problems,” Sri Mulyani said during the meeting at the House.

Prior to the budget committee’s approval, the government engaged in intensive talks with lawmakers from Commission XI overseeing the fiscal and financial sectors over the basic assumptions, such as on economic growth and inflation rates, as well as on fiscal and spending strategies for next year.

Based on the House’s suggestion, which took into account the lingering global risks that could affect the domestic economy, the government revised the 2018 economic growth predictions to between 5.2 percent and 5.6 percent, down from the 5.4 percent to 6.1 percent proposed earlier.

In the approved draft, inflation is set to range from 2.5 percent to 4.5 percent, while the rupiah exchange rate is set at between 13,300 and 13,500 per United States dollar.

Meanwhile, the three-month treasury bill rate may hover between 4.8 percent and 5.6 percent. Moreover, the poverty rate will range between 9.5 and 10 percent and the human development index (HDI) will settle at 0.715.

Sri Mulyani previously said that the growth range assumption for 2018 could boost optimism among market players toward Indonesia’s economy despite certain external risks potentially affecting the country’s exports, such as trade policies in the US and China.

Economists consider the extent of economic growth targeted for 2018 quite feasible to achieve as exports may improve, coupled with potentially higher investment flows thanks to ongoing structural reforms.

Private consumption, which represents more than half of Indonesia’s gross domestic product (GDP), will remain as the main engine of growth in 2017 and 2018 as commodity exports recover, SKHA Institute for Global Competitiveness (SIGC) said in its research note.

Better global commodity prices will positively impact people’s purchasing power, particularly those whose income is derived from energy-based commodities, which are mostly located outside Java, it noted.

The economic target for next year also concurs with the World Bank’s projection of 5.3 percent, largely based on sound government expenditure, higher exports and a potential rebound of commodity prices.

In a separate development, the government also conveyed to the House’s budget committee its ongoing work on the revised 2017 state budget as the budget deficit target will likely swell to Rp 370 trillion (US$27.65 billion), up from the initial target of Rp 330 trillion, on the back of bigger spending and a potential tax shortfall.

The initial deficit target was a gap between the expected state revenues and expenditures that settled at Rp 1.75 quadrillion and Rp 2.08 quadrillion respectively.

With such estimates, the budget deficit this year will rise to 2.67 percent from 2.41 percent initially, although the figure is still below the legal threshold for budget deficits of 3 percent of the country’s GDP.

“The [new] deficit [target] has included the calculation of potential spending from all ministries and institutions of about 95 percent [of each of their total budgets] in line with the regular pattern,” Sri Mulyani said.