Indonesian gov't approves 2.92% budget deficit proposal

It treads near the legal limit of 3%.

Indonesia's budget committee recently okayed the proposal to increase government spending to result a budget deficit of 2.92% of the GDP, near the legal limit of 3%.

The Edge Markets reported that the Indonesian government sees the gap at 2.67% by year-end.

The budget committee and the government set a 2017 spending increase at US$160.24b to address government expenses for energy and the 2018 Asian Games.

DBS Equity Research analysts said, "Realisation of government expenditures has only reached 94%, 85%, and 89% in 2014, 2015, and 2016, respectively. Supposing we hit 90%, the average of the last three years, fiscal deficit is likely to remain around 2.5% of GDP, barring a total collapse of tax revenue collection in 2H17."