The Jakarta Post
Indonesia has rolled out a fiscal stimulus worth trillions of rupiah and widened its state budget deficit beyond the 3 percent legal limit to afford a fight against the COVID-19 outbreak, but the figure seems small compared to what other countries are spending.
The government has set aside Rp 436.1 trillion (US$26.36 billion) for the stimulus, equivalent to 2.5 percent of the country’s gross domestic product (GDP), which still does not match what other countries have allocated for their fight against the outbreak, said Finance Minister Sri Mulyani Indrawati,
“Other countries have taken extraordinary measures to prevent the health crisis from turning into a financial crisis,” she told the House of Representatives Commission XI overseeing financial affairs in a teleconferenced meeting on Monday.
Australia’s fiscal stimulus, for instance, is 11 percent of its GDP, while Singapore has allocated 10.9 percent of its GDP, she added.
The United States, meanwhile, is rolling out a $2 trillion stimulus package, which is worth 10.5 percent of the country’s GDP, and Malaysia has set aside 100 billion ringgit ($23 billion) or 10 percent of its GDP.
“This means that [many] countries are taking similar measures,” Sri Mulyani said.
The government has announced plans to spend Rp 405.1 trillion on health care, social safety nets and business recovery programs to counter the effects of COVID-19. It previously announced an Rp 8.5 trillion stimulus package for tourism and vulnerable households, as well as a Rp 22.5 trillion package for manufacturing businesses.
The pneumonia-like illness has infected 2,738 people and killed 221 others as of Tuesday afternoon, according to official data.
The government has declared a public health emergency and imposed large-scale social restrictions to contain the virus, which has disrupted businesses and put vulnerable families at risk.
“Fiscal and monetary policies will be implemented to try to minimize the impacts of COVID-19,” Sri Mulyani said.
“This is an ongoing scenario because the situation is rapidly developing, particularly in April and May, which [experts say] will be the peak of the outbreak. Projections may change as the situation develops.”