Indonesia Pushes to Reopen Economy to Curb Mounting Job Losses

  • Indonesia is pushing ahead to reopen its economy amid a surge in coronavirus infections, with the government seeking to minimize job losses and the threat of social unrest.
  • Southeast Asia’s biggest economy will need to adjust and cope with the pandemic, which has already put 2 million people out of work in just two months, Coordinating Minister for Economic Affairs Airlangga Hartarto said.
  • Hartarto said Indonesia’s economy likely contracted less than 3% in 2Q20, and that the government is willing to widen its fiscal deficit further to help cushion the blow from the pandemic. He’s sticking to the official forecast of 2.3% economic growth for 2020.
  • The government has set aside about IDR642tr so far as part of its emergency virus response, with the budget deficit expected to widen to at least 6.3%. Authorities are now preparing additional stimulus, including IDR9.4tr for the farming and fisheries sectors, which may be announced in coming days, Hartarto said.

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