Government Promises To Boost Spending In The Remaining Year To Keep The Economy High

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JAKARTA - The government through the Coordinating Minister for the Economy Airlangga Hartarto said that state spending would be accelerated in the second half of 2023 to support the growth rate.

According to Airlangga, this effort also encourages the absorption of APBN expenditures in accordance with this year's target.

"In the second half, especially in the third quarter, we can still encourage economic growth by boosting government spending," he told the media crew in Jakarta, Monday, August 7.

Airlangga admits that the absorption of the state budget tends to be restrained at the beginning of the year. This is reflected in the contribution of government consumption which is only 7.5 percent of the formation of gross domestic product (GDP) according to expenditure.

For the record, government consumption is ranked fourth below household consumption (53.3 percent), Gross Fixed Capital Formation (PMTB) or investment (27.9 percent), and export (20.2 percent).

The government's spending in the second quarter of 2023 is relatively small. But with the start of bidding processes and others, we hope that this government spending can increase like last year," he said.

Citing the latest report from the 2023 State Budget, it is known that until June the total state expenditure is IDR 1,255.7 trillion. This figure is only around 41 percent of the ceiling set at IDR 3,061.2 trillion.

In detail, spending absorption on the central government side reached Rp891.6 trillion or 39.7 percent of the ceiling. Meanwhile, Transfers to Regions (TKD) have been distributed amounting to Rp364.1 trillion (44.7 percent of the ceiling), slowing down 1.0 percent year on year (yoy).

Meanwhile, the realization of economic growth in the second quarter/2023 was 5.17 percent or better than the previous quarter with 5.04 percent. Meanwhile, the overall growth target for the year is 4.5 percent to 5.3 percent.