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Jakarta Post

Accelerate priority spending

  • The Jakarta Post

  /   Fri, March 27 2020   /  01:26 am

President Joko “Jokowi” Widodo’s announcement of a plan to issue a regulation in lieu of law (Perppu) to allow for a higher state budget deficit is the right choice. Indonesia will need more funds to cope with the overwhelming demand for healthcare services as COVID-19 cases rise, while businesses and workers will need safety nets to protect them from a precipitous downturn.

By increasing the state budget deficit ceiling from the current 3 percent of gross domestic product (GDP), Indonesia will be able to borrow billions of dollars more to battle the pandemic.

The point is to accelerate budget disbursement and ensure targeted spending to prioritize health care, the social safety net and incentives for small businesses.

The government has announced plans to reallocate Rp 62.3 trillion (US$3.9 billion) in state spending from the 2020 budget to provide health care...