Indonesia Fiscal-Cap Review Backed by Crisis-Era Policy Reformer

One of the key technocrats who played a vital role in rebuilding Indonesia’s economy after the Asian financial crisis has raised concerns about the country’s long-standing budget-deficit cap stifling growth. Dorodjatun Kuntjoro-Jakti, an economist who helped rejuvenate the economy post-crisis, emphasized the necessity of reviewing the fiscal policy to ensure it aligns with current economic conditions. Kuntjoro-Jakti suggests that the budget-deficit cap, while initially beneficial for stabilizing the economy, could now impede growth opportunities for Indonesia. This caution reflects the evolving nature of fiscal policy and the need for periodic reassessment to adapt to changing economic landscapes.