Concern about Indonesia’s ability to service debt as economy falters

Growing debt: Fishermen gathering to repair their nets in Aceh. The pandemic prompts the government to increase public spending to finance stimulus packages. ― AFP

JAKARTA: The Supreme Audit Agency (BPK) has warned the government over a potential decline in its ability to service its increasing debt, after it hiked state spending in 2020 to finance economic stimulus measures as part of the national pandemic response.

BPK chairman Agung Firman Sampurna said that interest payments on national debt relative to government revenue stood at 19.06% last year, much higher than the 7% to 10% recommended by the International Monetary Fund (IMF).