Sri Mulyani: Debt Financing Drops 15.4 Percent In Semester I 2023

Minister of Finance, Sri Mulyani Indrawati. (Photo: Doc. Antara)

JAKARTA - Finance Minister Sri Mulyani reported that the realization of debt financing in the first semester of 2023 fell by 15.4 percent (year-on-year/yoy) when compared to the same period last year.

"Semester I debt financing has decreased by 15.4 percent, or in this case we issue only Rp157.9 trillion for net SBN (State Securities)," Sri Mulyani said in a Working Meeting with the Indonesian House of Representatives (DPR) Budget Board in Jakarta, quoted from Antara, Tuesday, July 11.

The realization of the issuance of SBN decreased by 13.6 percent yoy from last year's first semester record of IDR 182.6 trillion.

According to the Minister of Finance, the decline in the issuance of SBN was supported by a deficit and primary balance. The realization of the deficit in the first semester of 2023 was recorded at IDR 152.3 trillion, higher than the achievement of the same period last year of IDR 91.2 trillion. Meanwhile, the primary balance was recorded at IDR 368.2 trillion, up from the realization in the first semester of last year of IDR 279.0 trillion.

"So, this illustrates that the State Budget (State Revenue and Expenditure Budget) is experiencing a very good trend," said the Minister of Finance.

Taking into account the cash condition and volatility of the financial market, the Ministry of Finance is drafting a strategy related to the issuance of SBN. The strategy includes four main points, namely adjusting the SBN auction target, shifting the issuance of global bonds, optimizing the issuance of retail SBN, and flexibility of program loans.

The government also always strives for a combination of financing sources. It aims to meet the efficient budget financing target while still considering risks.

Furthermore, the Minister of Finance is optimistic that debt financing in 2023 could be lower by IDR 289.9 trillion from the APBN target of IDR 696.3 trillion.

Thus, debt financing is projected to be in the range of IDR 406.4 trillion or 23.9 percent of Gross Domestic Product (GDP). This value is down 41.61 percent from the realization in 2022 which was recorded at IDR 696.0 trillion.