TEMPO.CO, Jakarta - Deputy Minister of Finance Suahasil Nazara said that Indonesia was still paying debts inherited from the 1997-1998 financial crisis. At that time, the country’s debt to the gross domestic product (GDP) ratio reached 100 percent.

“Some debts from the 1998 crisis remain unpaid. It means, [the government] still has to repay it until now, and that was 22 years ago,” said Suahasil in a virtual dialogue with the Finance Ministry’s special staffer, Masyita Crystallin, on Thursday, June 18.

Suahasil added that the debt was recorded in the balance sheet of Bank Indonesia.

In the current crisis caused by the Covid-19 pandemic, he revealed, the government decided to issue more debt given the surge in the country’s need to handle the pandemic. Meanwhile, at the same time, tax revenue declines since economic activities are restricted.

However, he ensured that the nation’s debt-to-GDP ratio in 2020 was estimated to be much lower compared to that of in 1998, which is 30-35 percent. Loans were also obtained by issuing government bonds, either to domestic or foreign markets.

Recently, the government issued retail government bonds series ORI017 with the investment order starting Rp1 million. The bond offers a 6.4 percent fixed coupon rate per year until July 9, 2020.

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FRANCISCA CHRISTY ROSANA