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Prabowo says Indonesia never defaults on debt

Jakarta Globe - January 7, 2024

Trista Nagel, Herman, Jakarta – Presidential candidate Prabowo Subianto said on Sunday Indonesia has never failed to repay its debt and that no one should worry about the national sovereignty being compromised due to ballooning overseas debt.

In addition, Indonesia's debt-to-GDP ratio is among the lowest in the world, Prabowo said during the presidential debate at the Istora Sports Stadium in Jakarta.

"Our current debt-to-GDP ratio sits at around 40 percent which is among the lowest in the world," Prabowo said in response to a statement from rival candidate Anies Baswedan who criticized the government's debt.

"I have no concerns about other countries potentially intervening in our affairs because of our debt reliance on them because we never default on our debt. I have traveled around the world and found that other countries respect us. No country in the world can intimidate us," Prabowo said.

According to Finance Ministry data, the government's outstanding debt has reached Rp 8,041 trillion ($518.8 billion) as of November 2023, representing 38.1 percent of the GDP.

The average repayment period for government debt stands at 8.1 years, with 82 percent of the overall debt carrying fixed interests, shielding it from the volatility of fluctuating interest rates in financial markets.

Indonesia's debt-to-GDP ratio is lower than that of Singapore (167.9 percent), Myanmar (57.5 percent), the Philippines (57.6 percent), Thailand (61.4 percent), Malaysia (66.9 percent), and Laos (121.7 percent), based on data from the International Monetary Fund.

However, four countries in the region have a lower ratio than Indonesia, including Cambodia (35.3 percent), Vietnam (34 percent), Timor Leste (16.4 percent), and Brunei (2.3 percent).

A Finance Ministry official has said earlier that the government has always paid off its debt in the country's history.

Source: https://jakartaglobe.id/news/prabowo-says-indonesia-never-defaults-on-deb