THE REPUBLIC OF INDONESIA April 2009. 2 Presentation Outline 1Update of the Global Credit Crisis on Indonesias Economy 2Effective Policy Responses in.

THE REPUBLIC OF INDONESIA

April 2009

2

Presentation Outline

1 Update of the Global Credit Crisis on Indonesia’s Economy

2 Effective Policy Responses in 2008 and Proactive Measures for 2009

4 Fiscal Stimulus and Budget Financing

5 Conclusion

3 Indonesian Q1 2009 Profile: Budget and BOP

Update of the Global Credit Crisis on Indonesia’s Economy

4

Impact of the Global Credit Crisis on Asian Economies and Indonesia’s Macroeconomic Environment

Equity and currency markets have stabilized

Bank Indonesia has more room to cut policy rate due to fall of headline inflation

Sufficient foreign reserves (USD bn) despite global crisis

Source: Ministry of Finance, Bank Indonesia, Bloomberg

MarMar

Source: Ministry of Finance, Bank Indonesia, Bloomberg

Depreciation of Stock Indices & Exchange Rates

-44.69%

-45.57%

-42.31%

-32.55%

-27.90%

-46.35%

-29.26%

-39.16%

19.66%

5.07%

16.75%

9.66%

42.45%

27.62%

26.90%

14.27%

Thailand

Singapore

Philipines

Malaysia

S Korea

India

Brazil

Indonesia

Stock Index Exchange Rate

Comparison between January 2nd to April 20th 2009

0.0%

4.0%

8.0%

12.0%

16.0%

20.0%

Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09

USD Fed Funds Rate Bank Indonesia Rate Indonesia Inflation Rate

Mar 09Mar 09

5

Credit Growth Decelerated, But Remains Resilient

10%

15%

20%

25%

30%

35%

40%

45%

2007 - Jan May Sep 2008 - Jan May Sep Jan-09

Total bank credit growth Y/Y

Source: Bank Indonesia

Bank credit growth falling but remains at double-digit level Banks’ loan-to-deposit ratio stabilizing

Non-performing loans ratio remains low

6

Credit Contraction Resulting in Higher Financing Cost

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

1-Jan-08 1-Apr-08 1-Jul-08 1-Oct-08 1-Jan-09 1-Apr-09

Yie

ld

ROI 6.75% '14 ROP '14 Vietnam '16 UST 5 Yr

1-Jan-08 31-Dec-08 31-Mar-09

ROI-14 6.00% 8.73% 8.78%

ROP-19 5.76% 7.13% 5.16%

VIETNAM-16 5.91% 10.45% 8.27%

UST 5-Yr 3.44% 1.55% 1.66%

Bond yields have risen considerably amidst heightened risk aversion in global capital markets

Source: Bloomberg

7

International Bonds Historical Yield

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

Jan-07 Mar-07 May-07 Jul-07 Sep-07 Nov-07 Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

1300

1400

INDO-14 INDO-18 Spread INDO-14 vs UST- 5y - RHS Spread INDO-18 vs UST- 10y - RHS

Source: Bloomberg

Indonesia International Bonds Historical Yield Curve

8

30

50

70

90

110

130

150

170

Jan-2008 Mar-2008 Jun-2008 Sep-2008 Dec-2008 Mar-2009

Reb

ased

to

100

%

WTI Copper Nickel

Slowdown in Real Sector Growth has been Gradual

… The Trade Surplus Remains Stable

Despite the Decline in Raw Material and Commodity Prices…

Source: Central Bureau of Statistics, Bloomberg

40

60

80

100

120

140

160

Jan-2008 Mar-2008 Jun-2008 Sep-2008 Dec-2008 Mar-2009

Reb

ased

to 1

00%

Palm Oil Cotton Rubber

4

6

8

10

12

14

US

D b

illio

n

-100%

-50%

0%

50%

100%

( Export)LHS ( Import)LHS ( Export Growth)RHS ( Import Growth)RHS

9

6.0%6.6% 6.6%

5.9%6.3% 6.4% 6.4%

5.2%4.5%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

2007Q1 2007Q2 2007Q3 2007Q4 2008Q1 2008Q2 2008Q3 2008Q4 2009Q1

Slower Economic Growth Forecasted for 2009

Breakdown of GDP Growth

Quarterly GDP Growth

Source: Ministry of Finance, Central Bureau of Statistics* 2009 GDP based on Adjusted National Budget

5.1%5.7% 5.5%

6.3% 6.1%4% - 4.5%

0%

1%

2%

3%

4%

5%

6%

7%

2004 2005 2006 2007 2008* 2009*0%2%4%6%8%10%12%14%16%

GDP Growth Household Consumption Exports Investment

Effective Policy Responses in 2008 andProactive Measures for 2009

11

Steps Taken in Financial Markets and Forex Market

Supporting the Banking and

Capital Market Systems

Place government funds with state-owned banks to increase liquidity in the banking system

Increase the amount of deposits guaranteed by the government

Stronger coordination between the central bank and government in monitoring, supervising, regulating and policy implementations on banks and capital markets

Prepare crisis protocol (implementation of the Financial System Stability Committee)

Manage state-owned enterprises’ currency transactions to reduce currency volatility

Maintain a sufficient level of foreign exchange reserves through trade financing facilities and prevention of illegal imports

Requiring greater disclosure on large-sized purchases of foreign currency against IDR to curb speculative pressure on IDR

Double Bilateral Swap Facilities with Japan (US$12 bn) and signing bilateral swap facility with China in Local Currency equivalent to US$ 15 bn

Ensuring Foreign Exchange Stability

Balance Of Payment and National Budget 2009

13

Current Account Balance

Perkiraan Realisasi Perkiraan

I. CURRENT ACCOUNT -273 -259 607

A. Goods, net 4,562 3,570 3,974

1. Non Oil & Gas, net 2,564 2,697 2,505

1.1. Exports, fob. 24,492 19,597 18,8541.2. Imports, fob. -21,927 -16,901 -16,349

2. Oil, net -861 -1,017 -314

2.1. Exports, fob. 2,018 1,620 1,8232.2. Imports, fob. -2,879 -2,637 -2,137

3. Gas, net 2,859 1,890 1,783

3.1. Exports, fob. 2,929 1,906 1,8753.2. Imports, fob. -70 -16 -92

B. Services, net -3,261 -2,509 -2,100

C. Income, net -2,892 -2,494 -2,394

D. Current transfers, net 1,317 1,174 1,127

* Provisional figures

** Very provisional figures

ITEMS2008*

Q.4

2009**Q.1

Current Account: Tracking Q1 I 2009 (USD million)

Prediction Prediction Realization

14

Capital Account Balance


II. CAPITAL & FINANCIAL ACCOUNT -3,702 -182 2,200

A. CAPITAL ACCOUNT 29 19 19

B. FINANCIAL ACCOUNT -3,731 -201 2,181

1. Direct investment 1,698 -608 1,9891.1 Abroad -1,217 -1,289 -8811.2 In Indonesia 2,915 681 2,870

2. Portfolio investment -4,377 2,532 2,3222.1 Assets -467 -234 1642.2 Liabilities -3,910 2,766 2,158

3. Other Investment -1,052 -2,126 -2,1303.1 Assets -3,720 -440 -1733.2 Liabilities 2,668 -1,685 -1,958



ITEMS2008* 2009**

Q.1Q.4

Capital Account: Tracking Q12009 (USD million)


15

Portfolio Investment

Portofolio Investment by Foreigner: Tracking Q12009 (USD million)

2008**


PORTFOLIO INVESTMENT, LIABILITIES -3,910 2,766 2,158

A. Public Sector -2,892 2,742 2,8621. Global Bond 0 2,850 2,9202. Sukuk Valas¹⁾ 0 0 03. SUN Rupiah -1,626 -252 -8024. SBI -1,266 144 745

B. Private Sector -1,019 23 -7041. Saham -110 59 -4562. Debt securities -908 -35 -249

- Bankers Acceptance, net -809 5 -204a. Inflow 1,877 1,879 1,416b. Outflow -2,685 -1,873 -1,620

- Other securities, net -100 -41 -45a. Inflow 105 65 51b. Outflow -205 -105 -96

¹⁾ Nilai Sukuk Valas yang dibeli investor asing diasumsikan 95% dari total nilai emisi.* Provisional figures** Very provisional figures

Q1Q4

2008*ITEMS

2009**

1) Sukuk Valas : Global Islamic Bond (Asumed bought by Foreign Investor 95% from total Emision)* Provisional Figures** Very Provisional Figure


16

PerkiraanRealisasi Perkiraan

DI in Indonesia (FDI) 2,915 681 2,870

Migas, net 685 42 879- Inflow 1,980 1,078 1,603- Outflow -1,295 -1,036 -724

Non Migas, net 2,229 639 1,991- Inflow 4,589 1,656 4,138- Outflow -2,360 -1,017 -2,147



2009**Q1

2008*I T E M S

Q.4

FDI Inflow

FDI inflow and outflow: Tracking Q1 I 2009 (USD juta)

PerkiraanRealisasi Perkiraan

DI in Indonesia (FDI) 2,915 681 2,870

Migas, net 685 42 879- Inflow 1,980 1,078 1,603- Outflow -1,295 -1,036 -724

Non Migas, net 2,229 639 1,991- Inflow 4,589 1,656 4,138- Outflow -2,360 -1,017 -2,147



2009**Q1

2008*I T E M S

Q.4Prediction

Prediction Realization

PredictionPrediction Realization

17

Government Debt: Tracking QI 2009 (USD million)

Government Transaction


LOANS

Public Sector, net 1) 549 -431 -1701. Drawings 2,796 692 860

- Program loans 2,025 260 294- Contigency loans 0 0 0- Project loans 771 433 566- Other 0 0 0

2. Debt Repayments -2,247 -1,123 -1,031**Very provisional figures***Projections

2009**Q1ITEMS

2008*

Q4Prediction

Prediction Realization

18

Private Sector Transaction

Private Sector Debt: Tracking Q12009 (USD million)


LOANS

Private Sector, net 424 -1,510 -1971. Drawings 8,830 4,236 6,416

- Loans from affiliates, net 1) 2,312 854 2,467 - Loans from non affiliates, net 6,517 3,381 3,949

A. Banking sector 2,425 2,102 1,887- Loan 548 223 470- Bankers Acceptance 2) 1,877 1,879 1,416

B. Corporate sector 4,092 1,279 2,062- Loan 3,591 1,009 1,794- Trade credits 397 220 218- Debt securities 2) 105 50 50

2. Debt Repayments -8,405 -5,745 -6,613

- Loans from affiliates, net 1) -2,360 -1,017 -2,147 - Loans from non affiliates, net -6,045 -4,728 -4,466

A. Banking sector -3,046 -2,019 -1,867- Loan -361 -146 -247- Bankers Acceptance 2) -2,685 -1,873 -1,620

B. Corporate sector -2,999 -2,709 -2,599- Loan -2,360 -2,407 -2,213- Trade credits -434 -197 -291- Debt securities 2) -205 -105 -96

1) dicatat dalam NPI sebagai salah satu komponen Direct Investment in Indonesia2) dicatat dalam NPI sebagai salah satu komponen Portfolio Investment (liabilities)* Provisional figures** Very provisional figures

ITEMS2008*

Q4 Q.12009**

1) Noted in NPI as one of component in Direct Investment in Indonesia2) Noted in NPI as one of component in Portfolio Investment in (liabilities)* Provisional Figures** Very Provisional Figure


19

Foreign Reserve

36.0

3

33.8

7

30.3

2

34.7

2

40.0

8

40.1

1

42.3

5

42.5

9

47.2

2

50.9

2

52.8

8

56.9

2

58.9

9

59.4

5

57.1

1

51.6

4

54.8

4

3.5

4.0

4.5

5.0

5.5

6.0

6.5

0

10

20

30

40

50

60

70

Mar

-05

Jun-

05

Sep-

05

Dec

-05

Mar

-06

Jun-

06

Sep-

06

Dec

-06

Mar

-07

Jun-

07

Sep-

07

Dec

-07

Mar

-08

Jun-

08

Sep-

08

Dec

-08

Mar

-09

CadevBulan Impor dan Pemb. ULN Pem. - rhs

Miliar USD Bulan

Right Scale is for the MontsFor Import and Foreign Bond Payment

Right Scale is for the MontsFor Import and Foreign Bond Payment

Foreign Reserve

Foreign Reserve

MonthsMonths

USD BillionUSD Billion

*On April 2009 there is additional reserve from Global SUKUK : USD 650 Million

20

A. REVENUE 985.7 848.6 162.6 19.2

I. REVENUE 984.8 847.6 162.6 19.2

1. TAXATION 725.8 661.8 133.2 20.1

TAXES 647.9 587.8 113.8 19.4

DUTIES AND EXCISE 78.0 73.9 19.4 26.3

2. NON-TAX 258.9 185.9 29.4 15.8

II. GRANT 0.9 0.9 0.0 4.3

B. EXPENDITURE 1,037.1 988.1 159.7 16.2

I. CENTRAL GOVERNMENT 0.7 685.0 88.8 13.0

A. MINISTRIES 322.3 333.7 * 30.1 9.0

B. NON-MINISTRIES (SUBSIDIES, INTERST) 394.1 351.4 58.7 16.7

II. TRANSFER TO REGION 320.7 303.1 71.0 23.4

C. PRIMARY BALANCE 50.3 (28.9) 26.7 (92.6)

D. BUDGET DEFICIT (51.3) (139.5) 2.9 (2.1)

% TO GDP (1.0) (2.5) 0.0

E. FINANCING 51.3 139.5 54.1 38.8

I. DOMESTIC FINANCING 60.8 109.5 54.5 49.8

II. FOREIGN FINANCING (9.4) (14.5) (0.4) 2.7

III. ADDITIONAL FINANCING/DEBT 0.0 44.5 0.0 0.0

CASH SURPLUS 0.0 0.0 57.0

Orig. Budget Budget+ Stimulus

Real. Up to 31 Mar 2009

% Real.

National Budget 2009 Realization (in Trillion Rupiah)

21

Tax Collection by 31 Mar 2009 below 2009 target

22

4.0

8.3

0.2

4.5

0.5 0.1

2.2

5.8

0.3

3.9

0.3 0.20.0

2.0

4.0

6.0

8.0

10.0

Pertambangan Ind.Pengolahan Konstruksi Perdgan,htl&restorn Pengangktn&Kom. Keu,Real&jasa persh.

Triliun Rp PPN Impor sektoral s.d Maret

s.d Mar 2008 s.d Mar 2009

3.6

8.1

16.7

6.9 6.3

19.3

2.3

7.3

13.0

6.64.3

18.3

0.0

5.0

10.0

15.0

20.0

25.0

Pertanian Pertambangan Ind.Pengolahan Perdgan,htl&restorn Pengangktn&Kom. Keu,Real&jasa persh.

Triliun Rp PPh Nonmigas Sektoral s.d Maret


4.0

9.5

2.6

5.0

2.2 2.4

4.3

9.5

2.7

5.6

2.1 2.6

0.0

2.0

4.0

6.0

8.0

10.0

Pertambangan Ind.Pengolahan Konstruksi Perdgan,htl&restorn Pengangktn&Kom. Keu,Real&jasa persh.

Triliun Rp PPN DN sektoral s.d Maret


Agriculture Mining ManufacturingTransportation & CommunicationTrade & services Finance

Finance

Finance

Transportation & Communication

Transportation & CommunicationTrade & services

Trade & servicesConstruction

Construction

Manufacturing

ManufacturingMining

Mining

Non-oil corporate Income Tax

Import VAT

Domestic VAT

Tax Collection by Sector (ISIC-2) by March 2009

23

1,8

4,7

9,3

2,1

5,8

9,9

1,9

5,5

10,9 11,3

-

2,00

4,00

6,00

8,00

10,00

12,00

Januari Pebruari Maret

% th

d A

PB

N

%_2007

%_2008

11.2

4.5

7.111.8

5.910.9

17.9

6.3

12.2

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

Januari Pebruari Maret

Triliu

n R

p

2007 2008 2009

% Min Spending% Min Spending

2009 Stimulus

2009 non stimulus

Min Spending per March 2009 = Rp36,4 T, faster than 2008 = Rp28,7 T

Total Min SpendingTotal Min Spending

20072008

Ministries Expenditure by March 2009 = 10.9% (March 2008 = 9/9%)

24

R e a l i s a s i P e n a r i k a n P i n j a m a n L N ( b r u t o ) t a h u n 2 0 0 8 d a n 2 0 0 9

- - - - -

3 . 2

5 . 0

1 . 1

1 . 9

0 . 9

8 . 2

0 . 50 . 1 1 . 1

1 . 90 . 90 . 1

0 . 5

-

1 . 0

2 . 0

3 . 0

4 . 0

5 . 0

6 . 0

7 . 0

8 . 0

9 . 0

Tr

ili

un

Rp

P i n j a m a n p r o g r a m P i n j a m a n p r o y e k

JanJan

FebFeb

MarMar

SBN Neto

15.410.0

13.517.1

8.1

31.4

0.05.0

10.015.020.025.030.035.0

Jan Feb MarRealisasi 2008 Realisasi 2009

Cicilan Pokok Hutang

-3.7-3.5

-3.1 -3.1

-3.8-3.4-4.0

-3.0

-2.0

-1.0

0.0

Jan Feb MarRealisasi 2008 Realisasi 2009

Financing by March 2009

0,10,81,1

1,9

Program Loan Project Loan

Realization on Foreign Loan in 2008 and 2009

Government Securities

Bond Payment

2008 Real. 2008 Real.2008 Real. 2008 Real.

Fiscal Stimulus and Budget Financing

26

Fiscal Stimulus package for 2009

• Infrastructure and national programs, including:

– Expansion of program for poverty alleviation

– Expansion of credit program for small businesses

– Reduction in tax rates for small businesses

– Provision of subsidies for employee tax payments

– Additional infrastructure projects

Accelerate job creation and

foster growth of small scale businesses

• Subsidies on medicine and cooking oil

• Direct subsidies (cash transfers - unconditional and conditional) for low-income households

• Direct and indirect subsidies for education and health sectors

• Tax rate reductions on individual household incomes

Boosting the household

purchasing power

• Import duty facility on selected capital goods and materials

• Trade finance facility

• Tax rate reductions on corporate income and listed companies, as well as higher minimum threshold for individual income tax

• Discounts on electricity peak-hour charges for industries and lower prices of diesel fuel

Stimulate trade and promote

entrepreneurship

1

2

3

27

Fiscal Stimulus 2009 in Indonesia amounted 1.4% of GDP

1. 2009 budget deficit increase from 1% of GDP to 2.5% of GDP due to projected drop in revenue collection and additional fiscal stimulus

2. This deficit will be financed by:

a. Rp 51,3 trn (USD 4.6 bn) from 2008 budget cash surplus

b. Rp. 44 trn (USD 4 bn) Debt financing, contingent loan from WB/ADB, Japan and Australia

c. Additional loans program amounting to Rp1,1 trn from 2008 which had not been dispersed

earlier

Value (Rp)

A Tax-saving for Individual, Employee and Corporates 43.0

B. Import duty-subsidy / tax subsidy for business 13.3

C. Non-tax subsidy for business/job opportunity and household 17.0

Total Stimulus 73.3

Description

28

2009 Budget with Safety Net and Crisis Prevention Mechanism

Assumptions on Macroeconomic Indicators

Original Adjusted Original Adjusted

GDP growth rate 6.0% 4.5% Average IDR/USD 9,400 11,000

Average inflation rate 6.2% 6.0% Average oil production 960,000 barrels/day 960,000 barrels/day

Interest rate on 3-month short-term SBI 7.5% 7.5% Average ICP US$80/barrel US$45/barrel

Assumption 1 USD = IDR 9,400 for Original Budget, 1 USD = IDR 11,000 for Adjusted Budget Source: Ministry of Finance

EXPENDITURE

Original Adjusted

Central Government’s own expenditure $76.2bn $62.3bn

Capital and recurrent expenditure $32.3bn $27.6bn

Debt interest service $10.8bn $10.1bn

Total subsidy $17.7bn $11.2bn

Others $15.4bn $13.4bn

Transfers to regional Governments $34.1bn $27.6bn

Total expenditure $110.3bn $89.8bn

Total expenditure as % of GDP 19.47% 18.01%

Memo: Stimulus spending $ 1.3bn $ 1.9bn

REVENUE

Original Adjusted

Domestic revenue $104.8bn $77.1bn

Tax revenue $77.2bn $60.2bn

Non-tax revenue $27.5bn $16.9bn

External grants $0.1bn $0.1bn

Total revenue $104.9bn $77.1bn

Total revenue as % of GDP 18.50% 15.46%

BUDGET DEFICIT

Budget deficit -$5.5bn -$12.7bn

Budget deficit as % of GDP 1.00% 2.50%

2009 Budget (in USD)

The 2009 budget is designed to give the Government enough room toadjust to any potential impact of the global credit crisis

29

0

20

40

60

80

100

120

140

160

180

200

Dec(PrevYear)

Jan Feb Mar Apr May Jun Jul Agt Sept Nov

2006 2007 2008 2009

Approved Regional Budget 2006 - 2009

Year Approved Before April2006 68.63%2007 72.19%2008 100.00%2009 98.77%

30

Consolidated Deficit for Central and Region Government

-1.1

-0.5

-0.9

-1.3

-2.5

-0.50

-0.30 -0.35-0.1

-3

-2.5

-2

-1.5

-1

-0.5

0

2004 2005 2006 2007 2008 2009

National Budget

Regional Budget

% t

o G

DP

31

Outstanding Regional Development Bank Fund in SBIin IDR Trillion

6.52

14.42

40.35

33.35

24.01

-

10

20

30

40

50

2004 2005 2006 2007 2008

32

Newly 2009 Budget Outlook

Adjust macroeconomic assumptions: Economic growth: 6.0% 4,5% IDR/USD: 9,400 11,000 World oil price: 80 45 US$/b

Original capital and social spending through line ministries remain unchanged Incorporate fiscal stimuli (1.4% of GDP) to stabilize the economy

Revenue projected to be lower than original budget Accelerate expenditure disbursement from the central and regional government Semi Automatic price adjustment with maximum cap applied to gasoline price

Budget deficit: 1% to 2.5% of GDP Increase in budget deficit to be financed by 2008 budget surplus of US$4.7bn (1% GDP) and additional

debt of US$4bn (0.8% GDP) Arrange contingencies financing from multilateral and bilateral countries in anticipation of any worsening

of the Financial crisis

33

INSTRUMENT AMOUNT PURPOSE

JAPAN BSA USD 16 bio BOP

Cina BCSA USD 15 bio Trade

CMIM ASEAN+3 USD 15 bio BOP

JBIC+ADB Trade Financing

USD 1 bio Trade

DDO WorldBank USD 2 bio Budget

DDO ADB+Billateral USD 3.5 bio Budget

Available SWAP Agreement and Foreign Exchange Inflow 2009

34

2007 2008 2009

SUN (Rupiah) 86,37 86,93 31,38

SUKUK (Rupiah) 5,56

Global SUKUK 7,15(1

Global Bond 16(2 46.2(3 33,00(4

Total issued 77,1

Remaining Issuance 22,5

(2009 Value is as of April 16, 2009)

Bonds Issuance (in IDR Trillion)

(1 Equivalent to USD 650 Million(2 Equivalent to USD 1,5 Billion(3 Equivalent to USD 1,5 Billion(4 Equivalent to USD 3 Billion

35

Liquidity Support for Budget and BOP

Parameters: Deficit increased from USD5.5 bn (1.0% GDP) to USD12 bn (2.5% GDP) Finance by accumulated budget surplus amounted USD 4.6 bn Additional Debt required: USD 4.0 bn Under the volatile market, the additional “contingencies” financing coming from:

- The World Bank - ADB - Bilateral (G2G): Japan and Australia

Maintain amount of government securities of USD4.9 bn nett of issuance, including domestic and international Sukuk

Budget Deficit Financing (in USD)

In response to forex risk due to volatile market conditions, steps taken:

Extend BSA swap with Japan, USD 6 bn to USD 12 bn Bilateral swaps with China in Local Currency USD 15 bn Trade Financing through IND Exim Bank with JBIC up to USD 500 mn

Liquidity and Trade Financing Support (in USD)

36

2009 Funding Plan

Notes:

a) Estimates based on new set of assumptions plus additional fiscal stimulus measures

b) 2008 financing surplus

c) Additional debt from standby facility

2009 Original Budget 2009 Budget Outlook a)

Revenue and Grant 1 $104.9bn $77.1bn

Expenditures 2 $110.3bn $89.8bn

Deficit 1-2 -$5.5bn - $12.7bn

Financing 3+4+5 $5.5bn $12.7bn

Non Debt 3 $0.6bn $5.0bn b)

Amortization 4 -$11.3bn - $10.6bn

Loan -$6.6bn - $6.6bn

Gov. Securities -$4.8bn - $4.1bn

Gross debt Financing 5 $16.1bn $14.2bn

Loan $5.5bn $5.1bn

Program $2.8bn $2.8bn

Project $2.7bn $2.3bn

Gov. Securities $10.6bn $9.1bn

Additional Debt $4.0bn c)

Assumption 1 USD = IDR 9,691 for 2008, 1 USD = IDR 9,400 for 200 9 Original Budget, 1 USD = 11,000 for 2009 Budget OutlookSource: Ministry of Finance

Budget Deficit Financing (in USD)

Conclusion

38

Conclusion

• Indonesia continue to experience robust economic growth, improved investment climate, low inflation and reduce debt to GDP ratio.

• Indonesia economy experience a negative impact due to slower world economic growth and negative world trade volume.

• In response the global crisis, Indonesia introduce easing monetary policy, prudent financial sector, provide liquidity for forex market and fiscal stimulus in line with other Asian countries.

• In order to fulfill the financing need for fiscal stimulus, trade financing facility and liquidity support, Indonesia received various contingent facilities from the World Bank, ADB, and from bilateral counterpart such as Japan, China, and Australia.

39

THE REPUBLIC OF INDONESIA April 2009. 2 Presentation Outline 1Update of the Global Credit Crisis on Indonesias Economy 2Effective Policy Responses in.

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global crisis source

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