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Government
expects Indonesian economy to grow 4 percent this year |
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May 23, 2000
JAKARTA, MAY 22 (AP) - The Indonesian economy should grow by around 4 percent this year, senior Economics Minister Kwik Kian Gie said Monday. Noting that gross domestic product increased 3.2 percent in the first quarter from a year ago, Kwik said: "I'm still optimistic that the economy will grow about 4 percent in 2000." The central statistics bureau sparked controversy last week when it announced an increase in first quarter growth, but painted a somber outlook for the year ahead. The
bureau warned that the weak rupiah, political instability and legal
uncertainty could derail the recovery and result in revising its growth
forecast for the year down to 1.5 percent from more than 4 percent. Kwik also said the government may have to revise the budget if the rupiah remains around current levels, although he did not say when this would take place.
"But we'll need to consult parliament first before revising the budget," Kwik told reporters on the sidelines of a seminar. The rupiah slid to a seven-month low of 8,768 to the dollar on May 12, but has clawed back some losses and was trading at 8,293 to the dollar midmorning Monday.
The government already carried out arduous negotiations with parliament on the current budget and made several revisions to it based on requests from legislators. In particular, it agreed to tone down a planned fuel price increase and to raise the oil price assumption in the budget, giving the government more spending power. |