The Indonesian government through the ministry of finance prepares a number of incentives to boost an investment in the oil and gas sector as well as to lift the production - Photo by Finance Ministry Office

JAKARTA (TheInsiderStories) – Number of COVID-19‘ patients in Indonesia was expected to reach 95,000 people in May, said finance minister Sri Mulyani Indrawati. Based on the task force data, until March 6, total positive cases in the country recorded 2,491 and toll deaths 209.

The prediction, she added, was developed by the State Intelligence Agency in collaboration with the Bandung Institute of Technology and the University of Indonesia. She underlined that the government was striving to suppress or flatten the curve by spread the medical supplies across the archipelago.

“The number of patients will surge and thus, urgent, strategic steps are needed to curb the peak of the virus transmission. In research, the curve can be flattened, meaning the growth is inevitable but not exponential,” Indrawati told member of parliament through video conference on Monday (04/06).

To that, said the minister, the central government budget is prioritized to comabt the COVID-19 and faces threats that endanger the national economy and financial system stability. As an example, she revealed, the village fund budget will be used for social safety nets in the form of direct cash assistance to the poor population and the pandemic handling activities.

The policies has been regulated in Government Regulation in Lieu of Law Number 1 of 2020 concerning State Financial Policy and Financial System Stability. Based on the bill, the government needs an additional budget of Rp405.1 trillion (US$25.31 billion) during the handling of the COVID-19 situation.

It was stated that budgeting and financing the deficit could exceed 3 percent of Gross Domestic Product (GDP) until 2022. Then, in 2023 the deficit will return to normal at a maximum of 3 percent of the GDP.

Indrawati explained, the budget sources that can be used in handling COVID-19 are the budget surplus, the endowment funds, funds managed by the state firms and from the reducing of state capital injection in state-owned enterprises and raises the state bonds with the specific purpose of being able to be purchased by Bank Indonesia, SOEs, corporate and retail investors.

The government can also lend to the Indonesian Deposit Insurance Corporation, provide grants to local governments, and simplify the mechanism and simplification of financial documents. For regional financial policies, local governments are given the authority to refocus the use of regional state budget that is regulated by a minister of home affairs regulation.

By doing all the various policies, said the former World Bank’ managing director, the budget financing changed from the previous planned Rp307.2 trillion to Rp852.9 trillion. In details, the state revenues target has revised from Rp2,233.2 trillion to only Rp1,760.9 trillion and the state expenditure to Rp2,613.8 trillion from initially was changed from Rp2,540.4 trillion.

The government also added a special expenditure post for handling COVID-19 amounting to Rp255.1 trillion.

US$1: Rp16,000

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