Indonesia Books 2023 Fiscal Deficit of 1.65%, Smaller than Plan

STATE BUDGET - JAKARTA. Indonesia has reduced its 2023 budget deficit significantly to 347.6 trillion rupiah ($22.47 billion), equivalent to 1.65% of gross domestic product (GDP), based on unaudited figures, its finance minister said on Tuesday

The unaudited deficit was far smaller than the government's original 2023 fiscal deficit plan of 598.2 trillion rupiah, said Sri Mulyani Indrawati.

Indonesia's fiscal deficit in 2022 stood at 2.35% of GDP.

Last year was also the first year since 2012 when the government booked a primary surplus, Sri Mulyani said, referring to the fiscal balance excluding net interest payments on public debt.

Read Also: APBN 2023 Ditutup dengan Defisit 1,65% dari PDB, Lebih Rendah dari Target Awal

The government spent 3,121.9 trillion rupiah ($201.84 billion) in 2023, 0.8% up from the previous year, while revenues rose 5.3% to 2,774.3 trillion rupiah.

Indonesia has been trying to cut its fiscal deficit to navigate rising borrowing costs globally and better manage its existing debt after large expenditure during the COVID-19 pandemic.

The small deficit in 2023 came even as economic activity in Indonesia slowed with its exports shrinking amid falling commodity prices and weakening global trade.

Indonesia's GDP growth likely decelerated to around 5% in 2023 from 5.3% in the year earlier, Sri Mulyani said, predicting growth of 5.2% in 2024.

In the third quarter, Southeast Asia's largest economy expanded 4.94% on an annual basis, the weakest in two years. ($1 = 15,467.0000 rupiah)