JAKARTA - The Standard & Poor's Global Ratings (S&P) rating again maintains Indonesia's credit rating at 'BBB' with a stable outlook.
Head of the Communication and Information Services Bureau (KLI) of the Ministry of Finance Deni Surjantoro explained that the S&P assessed that the rating reflects solid economic growth, careful economic policy and the ability to manage public debt burdens prudently.
He said that the stable outlook also described the S&P's belief in the sustainability of fiscal discipline.
In addition, Deni said that S&P also projects that Indonesia's fiscal deficit will remain below 3 percent of GDP over the next three years.
"Although there are global challenges that have not subsided, Indonesia's fiscal policy is considered to remain measurable and consistent," he said in his statement, Wednesday, July 31.
He added that S&P also projects that Indonesia's GDP growth will remain high, around 5 percent per year in the next few years and domestic demand is believed to continue to be the main driver of growth momentum.
Deni explained that along with that, Indonesia's per capita income is also expected to increase, reaching US$5,000 this year.
"Development financing innovations such as the formation of the Danantara Sovereign Wealth Fund (SWF), which is also recorded by S&P, are expected to accelerate the financing of national strategic projects so that it has a positive effect on economic growth," he said.
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In addition, he said that government programs such as the provision of free nutritious food and the construction of three million houses are believed to strengthen people's purchasing power, improve quality of life, and maintain the momentum of domestic growth.
On the other hand, Deni said that the stabilization of external factors affecting Indonesia's GDP is also considered to be maintained, supported by a commodity-based industrial downstream policy consistently driven by the Government.
He added that investment in the downstream sector, such as the construction of a new nickel smelter and an electric vehicle battery factory that will soon operate, is believed to support external performance amid increasing global uncertainty.
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