ID :
74615
Mon, 08/10/2009 - 19:58
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https://www.oananews.org//node/74615
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DRAFT STATE BUDGET HAMPERS BUSINESS, BANK GROWTH : OBSERVER
Jakarta, Aug 10 (ANTARA) - The 2010 state-budget has the potential to hamper business and bank growth because it is contractive in nature and a crowding-out effect on the national economy, an observer said.
President Director for Banking Crisis (CBC) Ahmad Deni Danuri said here on Monday constraints on e economic growth could be observed from the decrease in the state budget deficit.
The deficit in the 2010 state budget was 2.5 percent of gross domestic product or down from to 1.6 percent in the previous budget he said.
"As a result, the double effect on the economy declined by 65 percent on the assumption that no leakage in the form of acute payment deficit," he said.
He said that the potential for the occurrence of acute payment deficit was big enough because free trade between China and ASEAN would begin in 2010.
Danuri said that India whose economic growth was higher than that of Indonesia set draft state budget deficit up to 9 percent of its gross domestic product in order to eliminate negative doubling effect.
The CBC director said that private consumption would be reduced by about 20 to 50 percent. This means that equilibrium in the banking sector would undergo changes so that banks, private banks in particular, would be forced to lower their landing interest rates.***
President Director for Banking Crisis (CBC) Ahmad Deni Danuri said here on Monday constraints on e economic growth could be observed from the decrease in the state budget deficit.
The deficit in the 2010 state budget was 2.5 percent of gross domestic product or down from to 1.6 percent in the previous budget he said.
"As a result, the double effect on the economy declined by 65 percent on the assumption that no leakage in the form of acute payment deficit," he said.
He said that the potential for the occurrence of acute payment deficit was big enough because free trade between China and ASEAN would begin in 2010.
Danuri said that India whose economic growth was higher than that of Indonesia set draft state budget deficit up to 9 percent of its gross domestic product in order to eliminate negative doubling effect.
The CBC director said that private consumption would be reduced by about 20 to 50 percent. This means that equilibrium in the banking sector would undergo changes so that banks, private banks in particular, would be forced to lower their landing interest rates.***
