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Jakarta Post

Govt to expand social aid, incentives to boost spending

  • Riska Rahman and Adrian Wail Akhlas

    Jakarta

Jakarta   /   Fri, August 7 2020   /  01:00 am
Menkeu Sri Mulyani (kiri) bersama Menteri BUMN Erick Thohir menyampaikan keterangan pers di Kantor Presiden, Jakarta, Rabu (24/6/2020).Pemerintah menempatkan dana sebesar Rp30 triliun pada Himpunan Bank Milik Negara (Himbara) dalam rangka mendorong percepatan pemulihan ekonomi nasional terutama untuk sektor riil. (Antara/Sigid Kurniawan/POOL)

The government is planning to expand its social aid program and incentives for micro, small and medium enterprises (MSMEs) in an effort to boost consumer spending and revive the sluggish economy in the second half of this year, as fears of a recession loom. Finance Minister Sri Mulyani Indrawati said on Wednesday the government would reallocate around Rp 70.8 trillion (US$4.85 billion) from existing ineffective stimulus packages to fund the social aid expansion and new incentives so that the government would not need to increase its COVID-19 response budget, already worth Rp 695.2 trillion. “This will include extending the social aid program period to December to cushion the impact of the COVID-19 pandemic,” she said during a livestreamed press conference. Indonesia’s gross domestic product (GDP) shrunk 5.32 percent year-on-year (yoy) in the second quarter as a...