Government Debt Nearly Rp7,500 Trillion As Of October 2022, Equivalent To 38.36 Percent Of Indonesia's GDP

Illustration. (Photo: Doc. Ministry of Finance)

JAKARTA - The Ministry of Finance (Kemenkeu) noted that the government's debt position reached IDR 7,496.70 or almost IDR 7,500 trillion as of October 2022. The position of government debt is equivalent to 38.36 percent of Indonesia's gross domestic product (GDP).

This ratio is lower when compared to the debt-to-GDP ratio in the same period the previous year, which was recorded at 39.69 percent. Meanwhile, when compared to the previous month, government debt in October 2022 experienced a nominal increase, from IDR 7,420.47 trillion in September 2022.

"There is an increase in the nominal amount and debt ratio at the end of October 2022 when compared to last month," explained the Ministry of Finance, which is written in the November 2022 edition of our APBN, quoted Monday, November 28.

The Ministry of Finance detailed that based on its type, Government debt is dominated by State Securities (SBN) instruments which reach 88.97 percent of all debt by the end of October 2022. Meanwhile, based on currency, the Government's debt is dominated by rupiah currency, which reaches 70.54 percent of the total debt.

The government assesses that the dominance of the rupiah can be one of the government's shields in dealing with high volatility in foreign currencies and its impact on paying foreign debt obligations.

"This step is one of the government's shields in dealing with high volatility in foreign currency and its impact on paying foreign debt obligations," explained the Ministry of Finance.

Meanwhile, the share ownership of SBN is currently dominated by banks and Bank Indonesia, while ownership of the share of ownership of foreign investors has continued to decline since 2019. The portion of foreign ownership in SBN in 2019 which was recorded at 38.57 percent, decreased to 19.05 percent at the end of 2021, and as of October 14, 2022, it fell again to 14.00 percent.

The government emphasized that this reflects consistent efforts in order to achieve financial independence and is supported by sufficient domestic liquidity, although the impact of tightening global monetary policy still needs to be watched out for.