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Indonesian GDP growth misses target in 2015, ministry reports

[JAKARTA] Indonesia missed its target for economic growth in 2015 because of a global slowdown, according to the Finance Ministry, which reported initial estimates for a larger- than-expected budget deficit and an undershoot on inflation for the year.

The economy expanded 4.73 per cent from a year earlier, missing the 5.7 per cent target set in the state budget, the ministry said in statement on Sunday. Inflation was 3.1 per cent last year, lower than the 5 per cent goal, the ministry said.

President Joko Widodo is seeking to spur growth in Southeast Asia's largest economy by cutting red tape and increasing infrastructure spending at a time when tax and commodity-export revenues are falling short of projections. The government has introduced seven stimulus packages since September to increase spending and boost investment to support the expansion.

The budget deficit may have totalled 2.8 per cent of gross domestic product in 2015, above the 1.9 per cent target, the ministry said. The government spent 1,810 trillion rupiah (S$184.7 billion) from the state budget last year, while revenue was 1,491.5 trillion rupiah, it said.

Tax revenue was 1,235.8 trillion rupiah last year, or 83 per cent of the amount the government was aiming for, as a weakening economy cut income from the mining and processing sectors, the ministry said.

The rupiah averaged 13,392 against the dollar in 2015, while the country's crude fetched about US$50 per barrel, below the US$60 target, the ministry said. Crude-oil sales seen were 779,000 barrels a day, below the objective of 825,000 barrels a day, it said.