Pertalite Prices Rose To Rp. 10,000, Observers: Many People Fall Overlined In Voluntary

Illustration. (Moksa Hutasoit/VOI)

JAKARTA - The government has officially increased the price of Pertalite and Solar fuel oil (BBM) to IDR 10,000 per liter and IDR 6,800 per liter, respectively. Economic observer from the Center of Economic and Law Studies (Celios) Bhima Yudhistira assessed that this price adjustment was carried out in an inappropriate time. According to him, the public is not ready to face an increase in Pertalite prices to Rp. 10,000 per liter. As a result, Indonesia could face the risk of stagflation, namely the increase in significant inflation and not being accompanied by job opportunities. "BBM is not just an energy price and specifically the cost of transportation for private vehicles is increasing, but also to almost all affected sectors. For example, the price of food supplies will increase at the same time, agricultural sector players complain about expensive production input costs, especially fertilizers," he told VOI, Saturday, September 3. Bhima detailed that inflation of food ingredients was still recorded high in August, which was 8.55 percent year on year, which would be higher. It is estimated that food inflation will touch double digits or above 10 percent per year this September. Meanwhile, general inflation is estimated to reach the level of 7 to 7.5 percent by the end of the year and trigger an aggressive increase in interest rates. "Consumers are as if they will fall on the stairs many times. The income from the pandemic has not yet recovered, now they are faced with rising cost of living and loan interest rates," he continued. Bhima further added that people who have private vehicles and do not have vehicles will reduce the consumption of other goods. Because fuel is a basic need, he said, when the price goes up, entrepreneurs in the finished clothing industry, food and drinks, and logistics will all be affected. According to him, business actors with requests that have just entered the recovery phase will also face the risk of mass layoffs. "Now it's realistic, production costs go up, operational costs go up, demand goes down, you have to cut costs. Expansion in the business sector can be stuck, the effect will be on PMI, the contraction manufacturing will be below 50," he continued. Meanwhile, regarding social assistance (Bansos) that will be given by the government to the underprivileged, according to him, it will only protect the poor within 4 months and will not be enough to compensate for the effect of increasing fuel prices. "For example, there is a vulnerable middle class, before the increase in the price of Pertalite, it is still able to buy at a price of Rp. 7,650 per liter, now the price is Rp. 10,000 per liter, they go down to the class to become poor people. Data on vulnerable poor people is very likely not to be covered in BLT BBM due to the addition of poor people after the subsidized fuel policy increases. The government needs to prepare for a chain effect of increasing the number of poor people in the near future," explained Bhima. Just so you know, the government has officially adjusted the price of Pertalite and Solar Subisidi subsidized fuel oil (BBM). For the new price, the government priced Pertalite, which was previously Rp. 7,650 per liter, to Rp. 10,000 per liter, Solar Subsidy, which was previously Rp. 5,150 per liter, increased to Rp. 6,800 per liter. "Today, September 3, 2022, at 13.30 WIB, the government decided to adjust the price of subsidized fuel, including Pertalite from Rp. 7650 per liter to Rp. 10,000 per liter and diesel from Rp. 5,150 per liter to Rp. 6800 per liter, Pertamax from Rp. 12,500 to Rp. 14,500 per liter," said ESDM Minister Arifin Tasrif at a press conference with President Jokowi and Minister Regarding the Transfer of Subsidy to Fuel, Merdeka Palace, Saturday, September 3. This price increase is valid for an hour since it was announced that this price adjustment was at 14.30.