Indonesia central bank gov says government has to explain some fiscal concerns

[JAKARTA] Indonesia's central bank governor said the government has to address some fiscal concerns which have been a key aspect in constraining a rating agency from upgrading the country's credit rating to investment grade.

Governor Agus Martowardojo said the government has to explain what it will do if state revenue falls below expectations, "whether the government is going to cut spending or increase bonds issuance", because it was one of the concerns.

He also said the government needs to set up a mechanism to determine retail fuel prices after it removed subsidies at the start of 2015.

Mr Martowardojo said Indonesia's overall economic condition has improved, but didn't say if he thinks Standard & Poor's should upgrade Indonesia's credit rating to investment grade, like what Moody's and Fitch did.

REUTERS