Head of the Fiscal Policy Agency (BKF) of the Finance Ministry Febrio Kacaribu projects that the increase in fuel price will push Indonesia’s inflation this year to lie in the range of 6.6 percent to 6.8 percent.
“We have calculated an increase of 1.9 percent in inflation from the impact of the fuel price adjustment. The 2022 inflation will lie in the range of 6.6 percent to 6.8 percent,” he noted in Jakarta, Monday.
Kacaribu remarked that this year’s inflation projection, ranging from 6.6 percent to 6.8 percent, exceeded the government’s target of four percent to 4.8 percent.
Meanwhile, Statistics Indonesia (BPS) recorded inflation as of August 2022 at 4.69 percent (yoy), which was down, from 4.94 percent (yoy) in the previous month.
Kacaribu remarked that the government will continue to maintain Indonesia’s inflation rate until the end of the year to remain below seven percent through controlled distribution and food prices.
“Until the end of 2022, we will strive to maintain the inflation rate with all efforts, specifically with maintaining food prices and the distribution. We hope the inflation to be below seven percent by the end of the year,” he added.
Earlier, the government on Saturday, September 3, raised the price of Pertalite fuel to Rp10 thousand per liter, from Rp7,650 per liter; the price of diesel fuel, from Rp5,150 per liter to Rp6,800 per liter; and the price of Pertamax, from Rp12,500 per liter to Rp14,500 per liter.
This increase was applied since the government shifted the fuel subsidies to social assistance on account of the fact that the number of energy subsidies and compensation taken from the state budget had reached Rp502.4 trillion, including energy subsidies of Rp208.9 trillion and energy compensation of Rp293.5 trillion.
President Joko Widodo remarked that increasing fuel prices was the government’s last option. He noted that the state budget should be prioritized to provide subsidies to the underprivileged, and at this time, the government must make decisions in difficult situations.
Source: Antara News