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Govt to launch economic stimulus to boost consumption
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Customers walk through Jakarta's Tanah Abang Market on Oct. 10, 2023. (JP/Yohana Belinda)
T
he government plans to announce economic stimulus measures on June 5 to revive activity and boost consumer purchasing power, hoping to push economic growth to around 5 percent this quarter, the Office of the Coordinating Economic Minister said on Saturday.
"These programs are prepared to encourage growth by increasing consumption," chief economic minister Airlangga Hartarto said in a statement, adding that launching the measures before a school holiday starting in late June would provide momentum to boost purchasing power.
Southeast Asia's largest economy grew 4.87 percent in the first quarter from the same period last year, its weakest in more than three years. The central bank trimmed its 2025 growth forecast to between 4.6 percent and 5.4 percent from a 4.7 percent to 5.5 percent range.
The ministry is still calculating the size of the stimulus package, which is meant to boost growth in the second and third quarters, a spokesperson said.
The incentives include a 50 percent discount on electricity bills for around 79.3 million households and food handouts for 18.3 million lower-income households in June and July.
The government also plans to give cash transfers to low-income workers and a discount on work accident insurance for workers in labor-intensive industries.
To boost tourism, the ministry said there will be discounts on airfare, train and sea transportation rates during the school holiday, which runs through mid-July, and discounts on highway tolls for 110 million users in June and July.
