JAKARTA – Indonesian President Joko Widodo proposed a budget of 3,304.1 trillion rupiah (S$293 billion) on Wednesday for 2024, his final year in office, promising to guard the economy against global challenges and keep food prices stable.

The budget proposal, tabled in Parliament, is about 6 per cent larger than the 2023 spending plan, which has been revised up to 3,123.7 trillion rupiah.

It also assumes a 5.2 per cent economic growth in 2024, below 2023’s target of 5.3 per cent.

Mr Widodo, popularly known as Jokowi, said he targets the 2024 budget deficit to be at 2.29 per cent of gross domestic product, roughly the same as the latest outlook for the 2023 deficit of 2.28 per cent.

“The 2024 state budget architecture must be able to respond to economic dynamics, address challenges and optimally support the development and welfare agenda,” Mr Widodo said in his annual budget speech to Parliament, a day ahead of the anniversary of Indonesia’s independence.

He offered no specific fiscal policy for 2024, but underscored the importance of food and energy security and building a competitive defence industry.

He also blamed global supply chain disruptions on geopolitical fragmentation.

Mr Widodo proposed allotting 108.8 trillion rupiah for food security to maintain stable prices, increase farm output and further develop the government’s ongoing food estate programme.

Infrastructure was allotted 422.7 trillion rupiah, including for Mr Widodo’s flagship project to build a new capital city on Borneo island, called Nusantara.

Mr Widodo has previously set a target to move some government offices to Nusantara in 2024 from Jakarta.

The budget proposal targets government revenues to rise 5.5 per cent in 2024 to 2,781.3 trillion rupiah, from 2023’s 2,637.2 trillion rupiah.

Mr Widodo said inflation will be managed around 2.8 per cent in 2024, within the central bank’s target range of 1.5 per cent to 3.5 per cent for 2024. Annual inflation in July was 3.08 per cent.

His proposal also assumed the rupiah exchange rate to average around 15,000 per US$1, the 10-year bond yield at 6.7 per cent, and Indonesia’s oil and gas lifting at 625,000 barrels per day and 1.03 million barrels of oil equivalent per day.

Parliament typically takes a few months to debate the government’s budget proposal. REUTERS