Sri Mulyani Admits 30 Local Governments Apply For Rp19.1 Trillion Loans To Overcome The Pandemic

JAKARTA - Minister of Finance (Menkeu) Sri Mulyani said that the government had approved loans submitted by 30 local governments (pemda) with a total value of Rp19.1 trillion.

According to the Minister of Finance, this loan is included in the National Economic Recovery (PEN) program scheme which is aimed at building facilities and infrastructure, as well as restoring the social and economic conditions of the people affected by the COVID-19 pandemic.

"The government opens up opportunities for regions to make loans, of course with fairly soft conditions so that local governments have the resources to continue development programs," she said in a Working Meeting with Committee IV DPD RI which was broadcasted online some time ago.

The Minister of Finance added that regional loans were used for the education, health, tourism, water resources (SDA) sectors, roads and bridges, and sports.

"We will continue to monitor so that this loan actually produces tangible results so that it also provides improvements to the economy and society in the area," she said.

Furthermore, the government, called Minister of Finance Sri Mulyani, also provided tourism grants for the 2020 period to local governments and the hotel and restaurant industry to support recovery from declining revenues due to the pandemic.

“Regions are experiencing very high shocks, such as in tourism areas such as Bali, which so far have relied on economic activities that require interaction. Restaurants, hotels, all of them are under pressure, and of course, this has an impact on local government revenues," she said.

For information, last year the government allocated Rp3.3 trillion in tourism grants to 101 regions, with details of 97 regions getting Rp3.2 trillion and 4 regions amounting to Rp14.2 billion.

Most of the funds given to local governments are used for revitalizing tourism facilities and infrastructure. Meanwhile, the largest use of the hotel and restaurant industry is for personnel operational spending.

"If the tourism (grant) can be for infrastructure and repair or maintain destinations for supporters in the form of accessibility or to provide assistance to small businesses, small industrial centers in the context of supporting tourism activities are expected to recover. This fund really helps them to be able to pay for their workers,” concluded the Minister of Finance.