JAKARTA (TheInsiderStories) – Indonesia’s Finance Ministry said the realized economic growth in 2015 is expected to reach 4.73 percent, lower than target set in the Revised 2015 State Budget (APBN-P) of 5.7 percent, mainly due to slowdown of global economy. Budget deficit was higher than target due to lower-than-expected tax revenues.
Based on preliminary data, the 2015 State Budget deficit was recorded at 2.8 percent of GDP. The realized revenues reached Rp1,491.5 trillion, while the government expenditures reached Rp1,810 trillion. As a result, the realized deficit for 2015 stood at Rp318.5 trillion or 2.8 percent of GDP, higher than the government’s target of Rp222.5 trillion or 1.9 percent of GDP.
The Finance Ministry said the realized growth estimation was based on economic growth recorded in the third quarter which stood at 4.71 percent year-on-year and expectation that the economic growth would have improved in the fourth quarter.
The economic growth was mainly driven by household consumption and government expenditure. The household consumption was guarded after the government issued policies including raised the level of income that was not subjected to income tax, strengthen the social safety net and maintain household consumption.
In second half, the government issued a number of economic policies aimed at lure investment and maintain consumers’ purchasing power as well as help stimulate economic activities. The economic policies help the country’s economy to remain relatively in better shape despite global economic woes as reflected in inflation rate which remained under control, while the economy still recorded positive growth, despite lower than target.
The Finance Ministry said inflation was estimated to be at 3.1 percent in full year 2015, lower than target of 5 percent set in the APBN-P. Three-month treasury bonds (SPN) was at 5.97 percent, lower than target of 6.2 percent. The rupiah exchange rate stood at average 13,392 to the US dollar, weaker than target of Rp12,500. Oil price was at $50 per barrel, lower than projection of $60 per barrel, oil lifting was at 779,000 bpd, lower than target of 825,000 bpd, while gas lifting was at 1,195 million barrels of oil equivalent per day (MBOEPD), lower than target of 1,221 MBOEPD.
The inflation rate was lower as the government managed to maintain basic goods supply and at the same time improved food production, distribution network and changed the energy subsidy scheme.
The average rupiah exchange rate was lower partly driven by high demand for US dollar to repay debts as well as external factor, following the rise of The Fed rate.
Realized 2015 Budget
In addition, the realized revenues reached Rp1,491.5 trillion or representing 84.7 percent of the revised State Budget 2015 target of Rp1,761.6 trillion.
Realized tax revenues stood at Rp1,235.8 trillion, or 83 percent of the set target of Rp1,489.3 trillion. Realized taxes revenues from non-oil and gas sector reached Rp1,005.7 trillion (including tax restitution) and net tax revenues (non-oil and gas) reached Rp1,055 trillion.
The lower realized tax was also due to lower commodity prices including CPO and mining products.
Meanwhile, realized non-tax revenues (PNBP) in 2015 reached Rp252.4 trillion or 93.8 percent from target of Rp269.1 trillion due to falling revenues from oil and gas sector as well as mining industry on the back of falling prices.
Realized expenditures reached Rp1,810 trillion or 91.2 percent from the upper limit of Rp1,984.1 trillion. Realized expenditure of the central government reached Rp1,1871 trillion or 90 percent of the target of Rp1,319.5 trillion.
Based on realized revenues (preliminary data) of Rp1,491.5 trillion and state expenditures of Rp1,810 trillion, the realized deficit for 2015 stood at Rp318.5 trillion or 2.8 percent of GDP, higher than the government’s target of Rp222.5 trillion or 1.9 percent of GDP. (*)