Current Account Deficit Predicted To Be Around 3 Pct

Jakarta, Aug 13 (Antara) - Bank Indonesia predicted the country`s current account deficit will narrow to 3 percent of the GDP by the end of this year from 3.3 percent a year earlier. Additional earning of US2 billion-US$3 billion expected from mineral exports should reduce the current account deficit to 3 percent this year, Bank Indonesia Governor Agus Martowardojo said here on Tuesday. The government has relaxed regulation, which bans exports of mineral concentrate. A number of miners including PT Freeport Indonesia , the country`s largest copper producer, have been allowed to export mineral ores on certain condition. The US company which has large copper and gold mines in Papua already started exports of copper concentrate last week. Agus quoted the energy and mineral resource ministry as saying the relaxation of the regulation is potential to increase earning from mineral exports by US$5 billion in 2014. "With additional export earning of US$2.5 billion would help much in improving the current account balance," he said. The government has renegotiated and reached an agreement with more than 100 mining companies holding contract of work. The mining companies are to build their smelters to process their ores in the country. The government has issued a new law banning exports of mineral ores effective as from January 12 , 2014. Agus, however, said growing imports of oil fuels (BBM) could still be a potential stumbling block in the efforts to improve current account deficit. The government, therefore, has regulated consumption of BBM that subsidized BBM is intended only for low income people.