Monday, 06 Jul 2020

Accept Luhut Debate Challenge, Student Senate: We Accept the Coordinating Minister's Challenge, When and Where We Are Always Ready


(Illustration / net)(Illustration / net) -

The Indonesian Economic Student Senate Association (ISMEI) is ready to accept the challenge of the Coordinating Minister for Maritime and Investment, Luhut Binsar Pandjaitan, to conduct debates related to state debt.

"We as young people who are still studying economics are ready to accept the challenge of the Coordinating Minister. When and where we are ready," Wahyu Pratama of ISMEI was quoted as saying by, Saturday, June 6, 2020.

From the Ministry of Finance's records, the total government debt until April 2020 reached Rp 5,172.48 trillion. When compared with the same period last year, the total debt increased by Rp 644.03 trillion or 14.22 percent.

The total debt is equivalent to 31.78 percent of GDP. This figure is still within safe limits in Law 17/2003 on State Finance which sets a maximum limit of the government's debt ratio of 60 percent of GDP.

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While from ISMEI data, the government debt ratio in 2019 was recorded at 30.2 percent of GDP. The number continues to increase from 2015 which amounted to 27.4 percent, 2016 recorded 28.3 percent, 2017 which was 29.4 percent, and 2018 which was 29.8 percent.

Meanwhile, the government's debt ratio is projected to rise to 37.6 percent in 2020, 37.5 percent-38.5 percent in 2021, 37.5 percent-38.4 percent in 2022, and 37.3 percent-38.3 percent in 2023.

"It means, since 2015 the Republic of Indonesia's sovereign debt continues to rise. If the government in formulating policies to cover the state budget deficit with only debt means the government is incompetent in managing state coffers, Indonesia is still a developing country, not compared to developed countries like Japan, America and China, "he explained.

He said, Indonesia's GDP is different from developed countries. "The structure of our bureaucracy is also different, our country has a major problem which is quite large, namely KKN. So the management of large debt when not properly managed can also be a big problem for this nation," he explained.

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Moreover, for future generations, it will surely be a burden to pay off the debt. "If the cabinet only knows that debt is replaced, many experts are more competent," Wahyu Pratama said.

"If our debt is considered fine as long as it is still below 60 percent of GDP, does the government debt to 60 percent of GDP? We do not mean anti-debt, debt is necessary if indeed it is needed and debt is not a problem if it is for the welfare of the people, debt is managed properly, because if debt is not managed properly it will be a dangerous scourge for all of us, "Wahyu said.

This Jakarta National University Graduate student said that the matter of debt will be the responsibility of future generations as well, not just the current generation.

"For this reason, we, the current generation, have the responsibility to question this as a moral form for all of us to come to the next generation. Debt can also affect our state order. As a debt country, we will potentially be controlled by the creditor country," he concluded.

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