TEMPO.CO, Jakarta - President Joko Widodo or Jokowi stated that Indonesia's foreign debt is still below 40 percent of gross domestic product or GDP. The statement was made in response to presidential candidate Anies Baswedan’s criticism during Sunday’s election debate.

The General Elections Commission (KPU) held the third presidential debate on Sunday, January 7, 2024, featuring Anies Baswedan, Prabowo Subianto, and Ganjar Pranowo at Istora Senayan. The debate focused on issues of defense, security, international relations, globalization, geopolitics, and foreign policy.

“Our debt to GDP ratio is still in good condition and safe, still below 40 percent,” the President said in Serang, Banten on Monday afternoon, January 8, 2024.

He mentioned that the law allows debt of up to a maximum of 60 percent of GDP. However, he stressed that Indonesia's foreign debt, which is 40 percent of GDP, is still under control. In comparison, he said large countries have debts of 260 to 220 percent of their GDP, while some neighboring countries have foreign debt of 66 to 120 percent of GDP.

“I think what’s most important is that the debt must be used for productive purposes that can bring returns to the country,” he said, without naming the countries.

The Finance Ministry noted that the government's debt reached Rp8,041.01 trillion as of November 30, 2023, or 38.11 percent of GDP. The figure increased from the previous month's Rp7,950.52 trillion or 37.67 percent of GDP.

In Sunday's debate, Coalition for Change-backed candidate No. 1 Anies Baswedan said Indonesia's foreign debt was not ideal as it was above 30 percent of GDP. “In our opinion, we should be able to reach a maximum of 30 percent [foreign debt] of GDP, so we are safe at below 30 percent,” the former Jakarta governor said in the debate.

Prabowo Subianto, candidate number 2 backed by the Indonesia Onward Coalition, responded to Anies Baswedan’s statement that Indonesia's foreign debt-to-GDP ratio remained low at around 40 percent. “Indonesia's current foreign debt to our gross domestic product ratio is one of the lowest in the world. It is still around 40 percent, while many countries are far above us,” he said.

DANIEL A. FAJRI

Click here to get the latest news updates from Tempo on Google News