DEFICIT IN DRAFT 2010 STATE BUDGET STILL SAFE: PRESIDENT

Jakarta, Aug. 3 (ANTARA) - President Susilo Bambang Yudhoyono said the 1.6 percent of GDP (Gross Domestic Product) deficit in the Bill on the 2010 State Budget was still quite safe and appropriate in the face of the current global economic crisis.

"Such a deficit is also safe for the realization of highly important development programs," President Yudhoyono said in his state address to introduce the government's financial note and the draft 2010 state budget before the Parliament here on Monday.

For that purpose, the government would pursue at least four policy measures, namely to seek for soft loans for a long term and at a relatively low cost; to issue rupiah government bonds (SBN) in the domestic market; to open the access to funding sources in the international market; and to withdraw the unrealized standby loans, according to the head of state.

The purpose of giving a priority to the SBN issuance was to boost the capital market and the market liquidity, he said.

The government would issue global bonds, global sukuk (Islamic bonds) and others as funding sources in the international market, he said.

Indonesia was also very determined not to use IMF funding assistance in overcoming the impacts of the global financial crisis, he said.

"The government had endeavored to establish a standby loan arrangement, which is more dignified and yet ensures that national economic sovereignty," he said.

The debt ratio vis-a-vis GDP at the end of 2010 is predicted to decrease from around 57 percent in 2004 to around 30 percent in 2010.

"We Should be relieved that this is the lowest debt ratio figure since the reformasi (reform) era," he said.

He stated the government's commitment to developing Indonesia to the maximum degree possible by using the nation's own resources.

The House of Representatives (DPR)'s extraordinary plenary session was also attended by DPR House Speaker Agung Laksono, Vice President M Jusuf Kalla, cabinet ministers, Members of Parliament, and foreign ambassadors.