RI's Debt Is Considered To Have Worryed

Illustration. (Photo: Doc. Antara)

JAKARTA - The General Chairperson of the Revival of the Prosperous Society (HMS) Center, Hardjuno Wiwoho, emphasized that the growth of Indonesian government debt could be said to be unreasonable.

With such a large debt burden, Indonesia has been trapped in a middle low income trap (low middle income countries) situation. This confirms that debt does not have a major role in stimulating the economic growth of a country.

What I'm worried about is that Indonesia will "loss several generations" (lost generation) due to malnutrition, lack of education, and a decline in health status from millions of Indonesian children as a result of the deteriorating economic situation due to piles of government debt. " said Hardjuno in Jakarta, Tuesday, March 21.

According to him, Indonesia's economy will find it difficult to develop. This is because state finances are held hostage for principal payments and interest on debt.

Unfortunately, every year economic growth is only 5 percent. Meanwhile, debt growth is far above that.

Of the 5 percent growth each year, 3 percent comes from consumption which means it does not add value to the economic chain, aka does not absorb work and increase state revenue in the future.

Only 2 percent of economic growth moves and advances the economy. This figure will not be enough to meet the growth of state debt because the debt rate has led to the hole-closed excavation pattern.

"In the end, this situation can also explain why the unemployment and poverty rate in Indonesia is still at a very high level," he explained.

According to Hardjuno, Indonesia has repeatedly missed the opportunity (miss opportunity) to break away from the middle low income trap, but it is not being put to good use. This is because policy makers repeatedly make fatal mistakes, namely, unproductive debt and ignore the most important sectors, namely agriculture and the real sector.

"So it's no wonder that GDP per capita Indonesia is far below Malaysia and also Thailand. The 1998 crisis of our banking has been destroyed because it is used by owners and oligarchs in BLBI crimes and BLBI Recap Bonds," Hardjuno explained.

Hardjuno explained that property credit is a credit that is disbursed to the developer conglomerate of luxury super blocks, luxury malls, apartments, and elite areas, which are speculative in nature. In contrast to the lower class property, which to this day still has a backlog (supply shortage).

Furthermore, Hardjuno said that when President SBY stepped down, he left a debt of IDR 2,700 trillion. Meanwhile, for 9 years, President Jokowi's administration has increased debt by IDR 5,300 trillion.

Even today, said Hardjuno, Indonesia's government debt as of the end of December 2022 reached IDR 7,733.99 trillion. The position of government debt increased by IDR 825.03 trillion compared to the end of 2021 which amounted to IDR 6,908.87 trillion.

It is estimated that today the government's debt is already above Rp. 8,000 trillion because every quarter Bank Indonesia continues to buy Government Securities of no less than Rp. 200 trillion.

With that much debt and a population of 275 million people, it means that every resident and even a newborn in Indonesia have borne a debt of Rp. 29 million.

Meanwhile, GDP per capita is recorded at 3,892 US dollars or Rp. 60 million per year or Rp. 5 million per month. Which means that every population, from infants, small children, housewives, unemployed, students, working fathers, has an income of Rp. 5 million a month.

If the average family in Indonesia only has 4 members, every Indonesian family on average has an income of Rp. 20 million.

When the debt borne by each resident is certain and must be paid, the income of Rp. 60 million for each newborn is a distorted number, aka because GDP per capita does not separate whether the income is generated by foreign companies or by local companies.

All economic outputs are counted as GDP. This is where it can be seen how burdensome the national financial structure is for the community.

Ahead of the 2024 general election, all elements of this nation, according to Hardjuno, must be aware of the basic problems of this nation. Because without that, what will happen to the people will always be sacrificed in the struggle for power of the elites. So it's no wonder there is always physical friction at the lower level during the democratic party.

The state budget continues to be wasted on elites who rely on additional debt. Meanwhile, money in banks stored by the people is distributed to conglomerates.

"If it continues to be allowed, inequality will be wider and the people will be more miserable," concluded Hardjuno.