2019 RAPBN IN THE MIDDLE OF GLOBAL UNCERTAINTY

company
Nov 14, 2018
2001

2018 is marked by a global economic turmoil that is not easy. The economic policy of the United States has a huge influence on the whole world. With global conditions full of uncertainty and turbulence, strong safeguards and bearings are needed so that the national economy can survive amidst shocks. The 2019 Draft State Budget is prepared using macro assumptions that are also overshadowed by the uncertainty of the global economy, therefore the government is compiling with the principle of greater caution.

Projected economic growth of 5.3%, inflation rate of 3.5%, rupiah exchange rate of Rp.14,400 / usd, 3-month spn interest rate of 5.3%, Indonesian crude oil price of USD70 / barrel, 750ribu barrel oil lifting per day and gas lifting is estimated at 1,250,000 barrels per day.

The 2019 State Budget Draft was delivered by President Joko Widodo at the DPR Plenary Session on August 16, 2018.

State revenue is targeted at Rp.2,142.5 trillion obtained from tax revenues of Rp.1,781.0 trillion, non-tax state revenues of Rp.361.1 trillion and grants of Rp.4.4 trillion. Meanwhile, state expenditures are budgeted at Rp 2,439.7 trillion with central government expenditure allocations of Rp 1,607.3 trillion and transfers to regions and village funds amounting to Rp 832.3 trillion. In the 2019 RAPBN there is a deficit of Rp. 297.2 trillion or 1.84% of GDP.

The APBN deficit continues to be reduced at the level of 1.83% of GDP as a form of increased caution. For the first time since 2013, the APBN was designed with a deficit of under 2% of GDP. The maintained APBN deficit in a downward trend is a healthy and sustainable APBN indicator.

Another APBN health indicator is the primary balance deficit of 0.13% which is the lowest number since 2012. A healthy, credible and sustainable budget is a strong capital in resisting global shocks.

Increased transfers to regions and village funds from Rp. 633.6 trillion to Rp. 832.3 trillion were directed towards strengthening the implementation of fiscal decentralization and achieving Nawacita. The biggest element of transfers to the regions is the general allocation fund which increased from Rp401.5 trillion to Rp414.9 trillion. As for village funds, strengthening the role of the village was realized by increasing the average amount of village funds received from Rp. 800.5 million to Rp. 973.9 million.

The 2019 Draft State Budget is also designed to be more independent which can be seen from the growth of state revenues by 12.6%. When compared with growth in 2014-2017 with an average growth of 3.8%, this 2019 growth is very sharp. In terms of taxation, the contribution of state revenue from taxes increased from 74% in 2014 to 83.1% in 2019.