Bunga Burden Swells, Sri Mulyani Affirms Commitment To Manage Debt Carefully

Minister of Finance Sri Mulyani Indrawati emphasized that the government will continue to be aware of the health condition of the state debt and ensure that the debt profile will be managed carefully (prudent) and measurably.

"The government ensures that the debt profile will continue to be managed prudently and measurably. Various indicators regarding the health of our debt will continue to be watched out for," he said at the 24th DPR Plenary Meeting of Session IV Session Year 2024 2025, Tuesday, July 15.

Previously, the National Awakening Party (PKB) and the Prosperous Justice Party (PKS) highlighted the increase in the ratio of government debt to Gross Domestic Product (GDP) which was estimated at 39.81 percent at the end of 2024, up from 39.21 percent in the previous year.

The increase in the ratio is considered to have the potential to increase the burden on the State Revenue and Expenditure Budget for debt payments by 2025. This is reflected in the projected increase in debt interest expense by 11.04 percent, from IDR 439.88 trillion in 2023 to IDR 488.43 trillion in 2024.

"The government appreciates the attention of the PKB and PKS factions regarding the realization of the 2024 debt interest payment expenditure which reached Rp488.4 trillion," Sri Mulyani replied.

He also added that the government will continue to monitor the main risks that can affect state debt, such as interest rates, exchange rates, and refinancing, so that they remain within safe limits both in the short and medium term.

"Nevertheless, homework for the deepening of the money market and bond market in Indonesia still needs to be improved and this means we have to work with the OJK monetary authority and the financial industry," he said.