In an attempt to strengthen the domestic investor base and to meet financing of the Revised 2014 State Budget (APBN-P 2014), the government offers Indonesian Retail Government Bonds (Obligasi Negara Ritel Indonesia, abbreviated ORI) again. This is the 11th time, the government issues ORI bonds since its first launch in 2006. The ORI series ORI011 is offered in the period 1-16 October 2014 with a coupon rate of 8.5 percent and a tenor of three years. The minimum allowed order is IDR 5 million and the maximum IDR 3 billion per individual.

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Indonesia’s House of Representatives (DPR) approved the 2015 State Budget on Monday (29/09) that was proposed by the outgoing President Susilo Bambang Yudhoyono administration. The budget deficit is now set at IDR 245.9 trillion (USD $20.5 billion), equivalent to 2.21 percent of gross domestic product (GDP), and lower than the 2.32 percent of GDP proposed by the government in both the Financial Memorandum and the Revised 2015 State Budget. However, the accepted budget deficit is still high compared to previous years.

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The government of Indonesia agreed with the House Budget Committee to adjust the economic growth target of Southeast Asia’s largest economy in 2015 to 5.8 percent, 0.2 percentage point up from the initial growth target proposed by the government in the Financial Memorandum as well as the 2015 State Budget Draft (APBN). Still, the 5.8 percent gross domestic product (GDP) growth target constitutes the lowest growth target set in Indonesia’s state budget (excluding revised state budgets) since the year 2010.

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The Indonesian government admits that it is difficult to achieve the 5.5 percent gross domestic product (GDP) growth target that was set in the Revised 2014 State Budget (APBN-P 2014). In fact, Deputy Finance Minister Bambang Brodjonegoro stated that Southeast Asia’s largest economy will have to work hard to reach +5.3 percentage point GDP growth this year. “We have to be realistic. Hopefully GDP growth will improve in the second half of 2014 to a level of 5.3 percent. The current forecast for GDP growth in 2014 is 5.2-5.3 percent,” he said.

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Before the second and final term of Indonesian President Susilo Bambang Yudhoyono has finished on 20 October 2014, the groundbreaking of a total of 13 infrastructure projects should have been conducted. These 13 projects are diverse ranging from toll roads to steam power plants and the extension of the Soekarno-Hatta International Airport located nearby Jakarta. One of these 13 projects - the IDR 9.65 trillion Trans Sulawesi Railway project - has already had its groundbreaking in mid-August 2014.

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