Jakarta – The government expects Indonesia's economy to expand as much as 6 percent next year, widening the 2010 budget deficit to accelerate growth.

In achieving the growth, the government aims to slow the inflation to between 4.5 percent and 5.5 percent, estimating the central bank's benchmark rate at 6 percent to 7 percent. Finance Minister Sri Mulyani Indrawati told a press conference Wednesday.

The proposed 2010 state budget deficit will be set at 1.3 percent although may be stretched up to 1.5 percent in consideration of some priorities needed to boost economic recovery.

"I think conditions in the financial market will allow us to get good financing." Mulyani said as quoted by Antara.

President Susilo Bambang Yudhoyono and Vice President Jusuf Kalla have agreed to tolerate a widening deficit should some priorities need to be realized.

The proposed budget, to be submitted to the House of Representatives on June 1, will have the rate of rupiah against the US dollar set at between Rp 9,500 and Rp 10,500, while the Indonesian crude oil price (ICP) per barrel is estimated to hover from $45 to $60, with productions of between 950,000 barrel per day (bpd) and 970,000 bpd.

Mulyani said the government's priorities in 2010 is economic recovery, therefore the real sector will continue to receive income tax cut.

The government will also provide stimulus to raise people's purchasing power, while creating labor-intensive programs to absorb employment, including the empowerment of people living in rural areas.

To finance the programs, the government will intensify bureaucracy reform, particularly in the taxation and customs sector, she added.

"Bureaucracy reform should be done with a good monitoring and planning so that bureaucracy works can increase in line with an improvement in administrative side and salary side," she said.

This year, the economy may only expand by between 4 and 4.5 percent, down from 6.1 percent posted in 2008. the Finance Ministry said.

The central bank has predicted a lower rate of between 3 and 4 percent. The economy grew by 4.4 percent in the first quarter of 2009 from a year earlier, according to the Central Statistics Agency (BPS).