JAKARTA: Indonesia’s new finance minister will retain the policy of his predecessor of keeping about US$17bil in the government’s standby funds with state lenders to boost borrowing and economic activity.
The so-called SAL funds, estimated at about 299 trillion rupiah to date, will be placed through July 2027, Finance Minister Suahasil Nazara said as he delivers his first budget briefing since taking over the ministry, providing a detailed snapshot of the government’s fiscal position.
“SAL placements are being carried out and managed in such a way so as not to disrupt banking stability or the economy,” Suahasil said, adding that his ministry will communicate monthly with the banking sector and the central bank – where the funds were previously placed.
“Later, when the withdrawal takes place, the Finance Ministry will coordinate to ensure there is no gap in funding availability within the banking sector,” said Astera Primanto Bhakti, director-general of Treasury.
Shares of state-owned PT Bank Mandiri, PT Bank Negara Indonesia, PT Bank Rakyat Indonesia and PT Bank Tabungan Negara held earlier losses last Friday. Indonesia’s budget deficit is on track to meet this year’s target of 2.85% of gross domestic product despite higher oil prices and rising US Treasury yields, Suahasil said. — Bloomberg
