President Joko Widodo (centre left) and Vice President Ma'ruf Amin (centre right) sharing a light moment on Aug 1, 2024 while attending a congregational prayer at Merdeka Palace in Jakarta to mark the start of the month of Indonesian Independence celebrations. - AFP
JAKARTA: President Joko 'Jokowi' Widodo said next year’s state budget must cater to all programmes planned by president-elect Prabowo Subianto in view of global economic risks, while opening a meeting on Monday (Aug 5) to discuss the 2025 government working plan (RKP) and draft state budget.
“I want the [...] 2025 state budget draft to accommodate all of the president-elect’s programmes,” the President said, according to a press statement released on Monday.
While Jokowi emphasised that the state budget must focus on priority programmes, he also noted that “it would be better if the 2025 state budget did not attempt to tackle everything”.
The government has included Prabowo’s free school meal programme in next year’s planned spending at an allocation of Rp 71 trillion (US$4.38 billion), which has been approved by the House of Representatives and deemed sufficient by Prabowo’s team to cover the programme’s first year.
The flagship programme is estimated to cost Rp 460 trillion annually once it is fully implemented in 2029 for 82.9 million schoolchildren, teachers and pregnant women.
Prabowo’s team revealed in July that the free meal programme was being piloted nationwide, and that the next government would use their results to formulate the programme’s blueprint.
The future of the president-elect’s other programmes meanwhile remains in the dark, while questions remain over Prabowo’s commitment to continuing the Nusantara Capital City (IKN) development project, dubbed Jokowi’s legacy project.
In July, Prabowo’s brother-in-law Soedradjad Djiwandono, arguably also his top economic advisor, said the free meal programme had a clearer budget plan than the IKN project.
“As an economist, I cannot lie that I prefer the nutritious [school] meals programme, because I know it can be implemented immediately. We have calculated the costs in detail, as well as the eligible [beneficiaries],” Soedradjad said on July 2, as quoted by Kontan.co.id.
He added that although he was not opposed to relocating the nation’s capital from Jakarta, the IKN project lacked the necessary cost calculations, especially on state budget funding.
“Now, do we want to keep borrowing money? Do we want to build a new capital with debt?” Soedradjad said.
In Monday’s meeting, Jokowi called for optimal efforts to increase state revenue, in particular highlighting ease of investment and trade as key to reaching the draft revenue target for 2025.
He also cautioned about the spillover effect from the global economic slowdown.
“The most important thing is to beware of global economic slowdown risks, whether they are related to interest rate policies or heated geopolitics, which is likely to [lead to a] food crisis and rising oil prices,” the President said.
Financial markets have seen wild movements on the back of fears about a recession in the United States following unexpectedly negative employment data published on Friday, a day after a separate report showed continuing manufacturing weakness in the world’s largest economy.
Some analysts had pointed to the Sahm rule, AFP reported on Tuesday, which indicates that an economy is in the early stages of a recession if the three-month moving average of unemployment is 0.5 percentage point above the low recorded over the previous 12 months. - The Jakarta Post/ANN
