Thursday, 5 June 2014


Indonesia’s economy was feared to be stationery unless there was improvement in state’s budget management. “Without essential breakthrough were afraid it would be stationery.” The Director of Institute for Development of Economic and Finance [indef] Fadli Hasan disclosed in Jakarta on Tuesday [20/5].

To illustrate, in the past 5 years around 50% of state’s budget was spent on energy subsidy and wages expenditure. Therefore, Fadhi suggested the next Government to focus effort on infra structure building and enhancement of bureaucracy efficiency; besides also on poverty eradication programs. “Apparently the portion of state’s budget increased for employees payroll and subsidy. Capital expenditure and social spending are closely related to the marginal group. Poverty elimination process had not been effective; expenditure kept increasing but reduction of poor people was slow.” He said.

Meanwhile Reza Hafiz, who was also an Indef economist remarked further that subsidy expenditure which expanded could not be benefited by the poor people. Most of the budget was spent on subsidizing oil and electricity consumed by well to do people. Subsidy for food was been less than 20% of total subsidy budget and tend to decline. For that matter fertlizerrs and seeds must be prioritized. (SS)

Business New - May 23, 2014

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