TEMPO.CO, Jakarta - The Finance Ministry reported that as of January 2016 government spending has reached 8.0 percent. Especially for capital expenditures, the absorption value has reached Rp 1.5 trillion.
This is a significant increase compared to 2015's record, wherein at the same period, government capital spending reached only Rp100 billion.
In January, the total value of contracted projects reached Rp25 trillion, while auctioned projects reached Rp100 trillion.
Askolani, the ministry's director general of budget, said that the Public Works and Public Housing Ministry accounted for the most value of auctions with Rp60 trillion. The ministry is targeting to complete 85-90 percent of all auction processes by March.
Finance Minister Bambang Brodjonegoro last week made an estimate that budget spending could reach 95-97 percent be year-end. He said this year the government also aims to accelerate budget transfers to regions outside of Jakarta.
Eric Sugandi, an economist from Kenta Institute, projected that this year's budget spending would be better. He estimated the economy to grow 5.2 percent, similar to the government's growth assumption, which is pegged at 5.3 percent.
Eric hopes government spending will increase this year's economic activities from public consumption. "Improving investments can also bring the government's fixed revenues closer to target," Eric said.
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