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Average GDP Growth and Budget Deficit of Several Countries Over a Decade
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Is Indonesia's budget deficit productive? Data from a presentation by Finance Minister Sri Mulyani shows that Indonesia's average budget deficit over a decade was 1.6 percent, yet it managed to stimulate a 5.6 percent Gross Domestic Product (GDP) growth. This means that a low deficit was able to provide a relatively high stimulus to economic growth compared to other countries. Indonesia was only outperformed by China, which grew by 9 percent with a deficit of only 1.1 percent.
Compare this to the fiscal deficits in developed countries such as the United States, which reached 6.7 percent but its economy only grew by 1.3 percent. Similarly, Japan, with a deficit of 6.4 percent, saw economic growth of only 0.5 percent. Even Italy recorded a deficit of 3.1 percent, yet its economy contracted by 0.6 percent.
In the 2017 State Budget (APBN), the budget deficit reached Rp 330 trillion or 2.41 percent. Economic growth for that year was targeted at 5.1 percent.
"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy,
but please note that automated translations may contain errors or slight inconsistencies."