Indonesia reports 2.29% GDP deficit for 2024

January 06, 2024 (MLN): Indonesia's unaudited budget deficit for the 2024 fiscal year was 2.29% of GDP, according to official data released on Monday.

This figure is smaller than the finance ministry's earlier estimate but larger than the deficit recorded in 2023, as Reuters reported.

Southeast Asia's largest economy had previously estimated a budget gap of 2.7% of GDP for all of 2024.

In 2023, it had a deficit of 1.61% of GDP.

The deficit forecast for 2025 is 2.53% of GDP.

Finance Minister Sri Mulyani Indrawati in her presentation of the data described the 2024 deficit as "a foundation for an effective transition of government", as Indonesia inaugurated Prabowo Subianto as its new president in October.

Earlier this week, she stated that the smaller-than-expected deficit could serve as a strong foundation for 2025.

Economists, however, have cautioned that 2025 could be an uncertain year due to changing policies in the United States under President-elect Donald Trump.

In Indonesia, financial markets have been closely monitoring the government's fiscal policy.

This follows Prabowo's statement about wanting to take on more debt to fund his flagship programs, which include providing free school lunches and significantly expanding farmland.

The "Free Nutritious Meals" program, which has a budget of 71 trillion rupiah ($4.39 billion), was scheduled to begin on Monday.

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