APSN Banner

Gov't to review energy subsidies later this year

Jakarta Globe - April 17, 2024

Jayanty Nada Shofa, Jakarta – The government is planning to review energy subsidies later this year, according to Chief Economic Minister Airlangga Hartarto.

President Joko "Jokowi" Widodo summoned his ministers to Jakarta's Presidential Palace on Tuesday for an internal meeting following Iran's retaliatory strike on Israel.

The attack has sparked worries over the escalation of the Middle East conflict, which is expected to cause economic impacts, including rising oil prices. Energy subsidies in Indonesia aim to make sure that prices remain affordable. The subsidies encompass fuel, liquefied petroleum gas (LPG), and electricity.

"We will assess [the energy subsidies] after June," Airlangga told reporters shortly after the meeting. Airlangga did not go into detail on the evaluation.

According to Airlangga, Indonesia has solid economic fundamentals, saying that the country has a 5 percent economic growth and keeps inflation under control. As Jakarta calls for a de-escalation of the Middle East conflict, the government keeps watch on the government spending.

"We will keep watch on the rising prices of logistics and oil," Airlangga said.

Indonesia has allotted Rp 189.1 trillion (approximately $11.6 billion) in government spending for energy subsidies. About Rp 75.83 trillion goes to electricity subsidies, while Rp 87.45 trillion is to help provide 3-kg LPG canisters for households in need and small culinary businesses, among others. Fuel subsidies stand at around Rp 25.82 trillion.

Source: https://jakartaglobe.id/news/govt-to-review-energy-subsidies-later-this-yea