Be aware of food, energy, and financial crises in 2023, says Indonesian Finance Minister

Jakarta, The Gulf Observer: Finance Minister Sri Mulyani Indrawati emphasized that Indonesia should be aware of the food, energy, and financial crises that can potentially occur in 2023, especially in countries without a strong foundation.

“Indonesia must increase vigilance against the possibility of various risks,” the minister noted at a press conference after handing over the DIPA and the Book of Transfer Allocations to Regions for the 2023 Fiscal Year at the State Palace, Jakarta, on Thursday.

Indrawati stated that vigilance can be conducted through the use of the state budget designed as an instrument to maintain optimism and increase awareness of changes in global risks.

Indrawati remarked that the state budget had been extensively used from 2020 to 2022 for COVID-19 handling.

However, implementation of the state budget has proven to help protect society and the economy. Thus, now is the right momentum to return the state budget to its original function, she remarked.

On the other hand, risks of the economy and the state budget have shifted from a pandemic to global risks, especially with the increase in goods related to food and energy.

The minister explained that the increase in commodity prices caused global inflation to soar high and then elicited a policy response in the form of monetary tightening and an increase in interest rates.

The global economy, with high inflation and monetary tightening, is also expected to cause stagflation and geopolitical tensions as well as increasing non-economic risks, she stated.

Hence, in order to maintain a healthy state budget but also still be able to utilize it as an instrument for maintaining global risk awareness, it must be implemented properly, she emphasized.

Moreover, President Joko Widodo has submitted the Budget Implementation Entry List (DIPA) and the 2023 Book of Transfer Allocations to Regions to ministers, heads of institutions, and regional heads.

Indrawati said the handover indicated that the 2023 state budget would be implemented and ministries/agencies (K/L) and local governments had started to conduct activities despite not having yet entered 2023.

“Ministries, agencies, and regions can start the activity using the 2023 state budget,” she stated.