Government Withdraws Debt At The Beginning Of The Year, Sri Mulyani: Before Interest Rises

Illustration (Photo: Doc. Antara)

JAKARTA – It is known that the government continues to accelerate debt withdrawals at the beginning of this year. This was revealed when the Minister of Finance (Menkeu) Sri Mulyani gave a presentation regarding the realization of the 2023 Revenue and Expenditure Budget (APBN) to journalists.

In her explanation, the Minister of Finance said that the net issuance of Government Securities (SBN) until February 2023 was IDR 177.7 trillion. That number skyrocketed by 162.6 percent compared to the same period the previous year with IDR 67.7 trillion.

“We are doing front loading because we all know there is a trend of rising interest rates. This is what we will anticipate in the second half of 2023, namely higher and longer. So we are looking for opportunities when interest rates have not yet risen to carry out the issuance," she said as quoted Wednesday, March 15.

On the other hand, the net loan value contracted by minus 63.7 percent to IDR 9.2 trillion from the previous IDR 25.3 trillion.

Thus, the realized value of debt financing up to last month was IDR 186.9 trillion, growing 101.1 percent year on year. This value is equivalent to 26.84 percent of the state budget target of IDR 696.3 trillion.

The Minister of Finance also ensures that debt financing through SBN and on-track loans is in accordance with the 2023 financing strategy.

"Debt procurement is carried out carefully by considering conducive market conditions and paying attention to the government's cash position," she said.

"The strategy for financing through debt in 2023 is carried out by continuing to prioritize Domestic SBN issuance, as well as optimizing Retail SBN issuance, while foreign currency SBN issuance is used to buffer debt financing. In addition, the issuance of the auction for the first quarter of 2023 has been reduced according to cash conditions," she concluded.