Accommodated By Bank Indonesia, Government Issues IDR 21.87 Trillion Debt For Financing The Impact Of COVID-19

JAKARTA - The government has issued four series of Government Securities (SUN) by means of a private placement with Bank Indonesia. The value is IDR 21.87 trillion.

Quoting the statement from the SUN Directorate of the Ministry of Finance, Wednesday 29 June, today's issuance of SUN is the third transaction in the context of implementing the SKB III. "This transaction was carried out based on Joint Decrees of the Minister of Finance and the Governor of Bank Indonesia Number 347/KMK.08/2021 and Number 23/11/KEP.GBI/2021," wrote the SUN Directorate.

The four series of SUNs are VR0074, VR0075, VR0076, and VR0077. The four of them are worth Rp5.47 trillion.

Each SUN has a coupon for the first month of 3.04 percent, with maturities starting on July 1, 2027, July 1, 2028, July 1, 2029, and July 1, 2030.

The SKB refers to the Coordination Scheme and Mechanism between the Government and Bank Indonesia for the Financing of Health and Humanitarian Handling in the context of Handling the Impact of the 2019 Corona Virus Disease (COVID-19) Pandemic through the Issuance of Government Debt Instruments and/or State Sharia Securities by the Government and Purchases in the Primary Market by Bank Indonesia.

And in accordance with the authority granted by Law Number 24 of 2002 concerning SUN and Regulation of the Minister of Finance Number 51/PMK.08/2019 concerning Sales of Government Securities in the Domestic Primary Market by means of Private Placement.

According to the statement, this transaction is a manifestation of the strong synergy and coordination of the Government's fiscal policy and Bank Indonesia's monetary policy, which together play a role in dealing with the impact of Covid-19. The government continues to maintain that the policy for handling the impact of Covid-19 remains within the corridor of prudent and credible financial management.

This is an important consideration given the Government's target of fiscal consolidation in 2023. From the financing side of the APBN, the Government continues to manage debt carefully and measurably, and pay attention to debt affordability to maintain fiscal sustainability.