Windfall profit from dearer oil to cover deficit
Thursday, September 28 2000 - 04:00 AM WIB
The Indonesian government plans to use the windfall profit from high world oil prices to help offset budget deficits, a report said yesterday.
The windfall profit, estimated to reach some 11 trillion rupiah (S$2.17 billion), will be used to cover parts of the deficit in the previous and current budget, the finance ministry's director-general for budgets, Anshari Ritonga, was quoted by the Kompas daily as saying.
Mr Ritonga said that for the April-December 2000 budget, part of the profit would be used to offset possibly lower-than-expected asset sales of the Indonesian Bank Restructuring Agency (Ibra) and of the government's privatisation drive.
The statement was made following calls, especially from the legislature, to use the money to alleviate the burden of the country's poor.
It was suggested that it could be used to increase state subsidies to cushion the impact of a hike in fuel prices to take effect in October, or to stabilise rice prices.
The government assumed an average oil price of US$20 per barrel in the current budget but prices have hovered around US$30 per barrel in the past few months. (*)