The 2023 Target for Domestic Product Spending Reaches IDR 1,100 Trillion

The 2023 Target for Domestic Product Spending Reaches IDR 1,100 Trillion (photo: Blake Wisz - Unsplash)

President Joko Widodo (Jokowi) is targeting this year’s domestic product spending of IDR 1,100 trillion, higher than last year’s of IDR 762 trillion. Jokowi has his own reasons regarding the size of the target.

He wants MSME actors to upgrade, therefore one of the methods taken by the government is to increase the target for domestic product spending.

He also asked the district and city governments to participate in the success of this program.

“Please continue to encourage this so that regions, regencies, and cities want to spend their APBD to buy domestic products,” Jokowi said at the opening of the APPSI National Working Meeting, Thursday (23/2/2023).

Efforts to increase awareness of spending on MSME products have actually been outlined in Presidential Instruction (Inpres) Number 2 of 2022 concerning the Acceleration of Increasing the Use of Domestic Products and Products of Micro Enterprises, Small Enterprises, and Cooperatives.

The Presidential Instruction 2/2022 is in the context of the success of the Proud Made in Indonesia National Movement. With this Presidential Instruction, Jokowi asked all ministries and institutions, local governments, and BUMNs to utilize domestic products.

Jokowi himself is proud of last year’s achievement, in which spending reached IDR 762 trillion. Jokowi said that the US had only promoted domestic products in January, while Indonesia had been earlier last year.

“The US has just enacted in January 2023 the use of domestic products and we are already ahead of the year, already doing it. We are trendsetters, not followers,” said Jokowi, on a separate occasion.

On the other hand, Jokowi said that the Indonesian people would hold back their spending and spending a little in 2022. They prefer to keep their funds in banks.

Several reasons why people tend to choose to save money over shopping in the past year are due to the many restrictions on activities. However, after the PPKM regulation was repealed, Jokowi hoped that people’s purchasing power and spending could be revived.

Jokowi reminded me that in 2022, public savings funds in banks will reach IDR 690 trillion. These funds must be liquid so that the national economy can rotate.

In 2022, public spending was halted due to the instability of global economic conditions. People prefer to keep their money in the bank.

“Be careful about this, it seems trivial, but don’t let Rp. 690 trillion stays in the bank’s savings account, that’s not good for economic growth,” he concluded.

“The increase in public savings at the bank in 2022 is IDR 690 trillion. Community funds are held and not spent, meaning that people are discouraged and don’t want to shop. They don’t want to come to restaurants, they don’t want to come to malls, they don’t want to come to shops. No shopping. It’s better to save at the bank, this is not allowed. We have to encourage the public so that they can spend as much as possible to trigger our economic growth,” said Jokowi.

He hopes that the public will want to increase the frequency of spending instead of continuing to save. The goal is for the Indonesian economy to become more stable.