Jakarta, CNN Indonesia —
Chairman of the National Economic Council (DEN) Luhut Binsar Pandjaitan asked the Minister of Finance (Menkeu) Purbaya Yudhi Sadewa injecting IDR 50 trillion in funds into the Indonesia Investment Authority (WHEN).
Luhut believes that INA can work hand in hand with Danantara. Danantara manages BUMN dividends and invests independently, while INA is expected to receive state capital injections every year.
“There is one thing I want to talk to the Minister of Finance (Purbaya), but I think he already knows, that is INA. INA is our sovereign wealth fund,” he said in 1 Year of the Prabowo-Gibran Government: Optimism on 8% Economic Growth at the JS Luwansa Hotel, South Jakarta, Thursday (16/10).
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“If we withdraw an investment of IDR 50 trillion there (INA) every year from the remaining funds at Bank Indonesia (BI) of IDR 491 trillion, of which IDR 200 trillion has been put into banking, if we leverage it could be IDR 1,000 trillion in the next five years. That’s a very large number,” suggested Luhut.
The Indonesian government does have an excess budget balance (SAL) which has been sitting in the central bank. Purbaya began distributing the money since he became finance minister on Monday (8/9).
Purbaya’s first targets were five state-owned banks. He hopes that the placement of government money worth IDR 200 trillion can increase credit growth and stimulate the economy.
Luhut supports the Purbaya school of thought to pour fresh funds into the real sector. He also saw that M0, aka base money, is currently dry.
“I see the new Minister of Finance (Purbaya), he is really encouraging his school of thought to flush the market by putting IDR 200 trillion in banking. I think that’s a very good step,” said Luhut.
“We are starting to see the government injection of Rp. 200 trillion given by the Minister of Finance (Purbaya) showing results. Of course it takes time. Sometimes we feel like eating chili, when we bite it, it’s hot. Yes, no, it takes time, it’s a process,” he added.
On the other hand, Luhut emphasized the importance of INA being injected with SAL money. He believes that Indonesia’s economic movement will be faster, especially with the 8 percent economic growth target announced by President Prabowo Subianto.
“So, we will have two engines of growth which I think are extraordinary. One, INA. The other is Danantara,” stressed Luhut.
[Gambas:Video CNN]
(skt/pta)
