President: Steps Taken To Shore Up Flagging Economy

Jakarta (Antara Bali) - President Joko Widodo said the government would take a number of steps to shore up the country's flagging economy.

The first step is to accelerate budget spending , the president told reporters of a number of news agencies after the cabinet reshuffle on Wednesday.

"I would push for immediate disbursement of the state budget. Immediate disbursement of budget funds for capital spending,and procurement of goods is needed as it would have effect on the economic growth and public consumption," the president said at an interview with Antara News Agency, RRI and TVRI, here, Wednesday.

So far implementation of the state budget program  was small much short of expectation , he added.

In the remaining five months of the year,  the government would seek to spend the remaining 88 percent of the budget fund.

"Capital spending by the government reached only 12 percent of the budget fund. This means the remaining 88 percent has to be spent in the next five month," he said.

"The fund is available . What is needed is how to spend it," he added.

The problem is the same with regional budgets , he said, adding," last time I saw , the  regional budget funds were still idle in the regional Development Bsnks ((BPD) totaling around Rp273 trillion."

Governors, regents and city mayors are expected to immediately use the funds to revive the economy, he said.

He said state companies also are expected to immediately implement their plans of capital spending to contribute to economic development .

State companies still have Rp130 trillion unspent  budget for  capital expenditure, he said.

The private sector is also expected to contribute to economic growth through investment, he said.

The self confidence of the private sector needs to be bolstered that the future would be better, he said.

The last step is to encourage foreign investment for which we have simplified regulation  with the system of "one stop service", he said.

Increase in the inflow of  foreign capital would push up share prices on the domestic market, he said, adding that global crisis had been a big challenge.

The composite share price index of the Indonesian Stock Exchange plunged to this year's a record low  on Wednesday following China's yuan devaluation.

The president reshuffled his cabinet ministers on Wednesday including  four  holding economic portfolio.

One notable change is in the post of coordinating minister for economy  given to former Bank Indonesia governor Darmin Nasution  replacing Sofyan Djalil. (WDY)