TEMPO.CO, THURSDAY, 25 FEBRUARY, 2016 | 10:34 WIB
TEMPO.CO, Jakarta – Economist Faisal Basri has suggested the government to cut its spending in 2016 State Budget (APBN) to help in achieving the target of economic growth of 5.3 percent.
“There’s no other way, spending must be cut. However, it doesn’t mean that planned projects should be canceled,” he said in Jakarta, Wednesday evening, February 24, 2016.
The total state budget in 2016 State Budget is Rp2,095.7 trillion, an increase from 2015 Revised State Budget (APBNP) of Rp1,984.1 trillion.
Therefore, the lecturer of Economy and Business Faculty of University of Indonesia went on, SOEs must be encouraged to fund temselves, among others by issuing their own bonds.
“So Indonesian government won’t need to issue bonds,” he said.
As an example, he said, PT Pelabuhan Indonesia III (Persero) had done it before by issuing bonds worth Rp9 trillion-Rp10 trillion to fund seaport project.
In mid-2016, PT Angkasa Pura II (Persero) or AP II will also issue bonds worth Rp2 trillion to fund company capital expenditure in 2016 which is around Rp11 trillion.
“As a consequences, the project must be attractive; if not, the bonds will not be sold out,” said the economist.
He also added that the government can not rely on tax amnesty which bill is still being deliberated in the House of Representatives.
Asked about the economic growth of 5.3 percent targeted by the government, Basri is pesimistic that it could be achieved. Even after what he had suggested, he projected that the 2016 economic growth would be at a maximum of 5.2 percent.
“Economic growth of 2016 will be better than in 2015; even though it would be lower than the government’s target, it would still be higher than the IMF’s estimate,” said Basri.
Faisal Basri is currently senior lecturer at the Faculty of Economics, University of Indonesia and Chief of Advisory Board of Indonesia Research & Strategic Analysis (IRSA). His area of expertise and discipline covers Economics, Political Economy, and Economic Development.
His prior engagement includes Economic Adviser to the President of Republic of Indonesia on economic affairs (2000); Head of the Department of Economics and Development Studies, Faculty of Economics at the University of Indonesia (1995-98); and Director of Institute for Economic and Social Research at the Faculty of Economics at the University of Indonesia (1993-1995), the Commissioner of the Supervisory Commission for Business Competition (2000-2006); Rector, Perbanas Business School (1999-2003).
He was the founder of the National Mandate Party where he was served in the Party as the first Secretary General and then the Deputy Chairman responsible for research and development. He quit the Party in January 2001. He has actively been involved in several NGOs, among others is The Indonesian Movement.
Faisal Basri was educated at the Faculty of Economics of the University of Indonesia where he received his BA in 1985 and graduated with an MA in economics from Vanderbilt University, USA, in 1988.