Jakarta, Sept 2 (Antara) - Amid determination of president-elect Joko
Widodo (Jokowi) to raise subsidized fuel price that has burdened state
budget, some still believe this situation will not occur, as it will
affect the livelihood of the people.
After all, the Indonesian Democratic Party of Struggle (PDIP)--which
will become the ruling party after the current government ends its
tenure in October--has always opposed the government's plans to increase
subsidized fuel prices in the past.
Therefore, Jokowi should be consistent with the stance taken by PDIP,
which had always rejected President Susilo Bambang Yudhoyono's plan to
increase subsidized fuel prices.
"Although it is still in discourse, it has served as a challenge for
Jokowi and PDIP to try to be consistent with the argument that they have
raised over the last ten years," stated Lucky Djani, the director of
Strategic Initiative Institute, on Monday.
Jokowi, who had paired with Jusuf Kalla and won the July 9 presidential
election, will be installed as the new president on October 20, 2014,
succeeding President Susilo Bambang Yudhoyono.
Jokowi had attempted to ask Yudhoyono to increase subsidized fuel
prices before he assumed office in October, but the latter had denied,
saying that it was not yet the correct time to increase prices, as it
will affect the people. Increasing the price now will increase the
burden of the people, following an earlier price hike in 2013 and an
increase in the electricity tariff in 2014.
The issue over subsidized fuel prices has become a national controversy
after the incumbent president rejected the request of Jokowi.
Lucky reminded how the PDIP, in the administration of President Susilo
Bambang Yudhoyono, had consistently rejected fuel price hike with
convincing arguments.
"However, at present, after becoming president-elect, there has been a
plan to raise subsidized fuel prices due to the limited fiscal space. It
will surely pose a dilemma for Jokowi," he pointed out.
"So, Jokowi should not only be consistent with the discourse that has
been put forward by PDIP politicians, but also find a solution on what
they had raised through arguments and statements so far. How they can be
applied still remains to be found," he remarked.
This discourse has raised pros and cons, even among the internal
elements of the PDIP who had supported Jokowi as president. For
instance, PDIP politician Rieke Diah Pitaloka opined that reducing fuel
subsidies and diverting them to other sectors is not the only way to
safeguard the budget, as she believes that the increase in fuel price
will only victimize the people.
Even so, Rieke is certain that Jokowi will not be subject to the market economy by raising the price of fuel.
Senior politician of President Yudhoyono's Democratic Party (PD)
Marzuki Alie, who is also the house speaker, is confident that the PDIP
will be consistent in its long-standing stance.
Marzuki informed reporters on Monday that he supported the viewpoint
held by the PDIP so far, which says it will use creative means to
increase budget efficiency, increase revenues through taxes, such as
liquor tax and collection of accounts receivable from other countries,
apart from reducing fuel subsidies.
"I am certain about their consistent refusal to cut fuel subsidy, and
of course, I along with every citizen of Indonesia will support PDIP's
measures to tackle the budget deficit," he stressed.
Increasing fuel prices, as currently voiced by the PDIP elite, should
be the last option, not the first one, to address the deficit, according
to Marzuki.
Jokowi is now ready to hike the fuel prices by reducing subsidies to
narrow the budget deficit. The funds generated from the fuel subsidy
will then be diverted toward efforts to improve people's welfare,
particularly in productive sectors, such as education, health, direct
assistance to the poor, and other sectors currently being assessed by
Jokowi's transition team.
"If
every effort to tackle deficit has been made and no other choice is
left, then it is fine (to raise fuel prices)," Marzuki pointed out.
However, Marzuki emphasized that the impact on the community must be
considered, and the increase in fuel price should not have a negative
impact on the lives of the people or even become dramatically worse.
Various circles, including businesses from the Indonesian Chamber of
Commerce and Industry (Kadin), supported the idea of raising fuel prices
in an effort to create business certainties.
"We
will appreciate a firm policy in fuel subsidy to provide us certainty
in business planning," chairman of the West Java chapter of Kadin H
Agung Suryaman Sutrisno said.
An economist from the University of Atmajaya, A Prasetyantoko, said the
government of Jokowi and Jusuf Kalla (Jokowi-JK) might have to raise
the prices of oil fuels to reduce subsidy burden.
"The
government of Jokowi-JK will likely have to inherit heavy burden from
its predecessor. The composition of the draft state budget read out by
President Susilo Bambang Yudhoyono on August 15 will leave a serious
problem for Jokowi-JK," Prasetyantoko noted.
The present government has set energy subsidy at 18 percent of the
total expenditures and 7.6 percent for the payment of debt interest.
Based on the financial note and Draft 2015 State Budget, the BBM
subsidy target has been set at Rp291 trillion, up from Rp247 trillion in
the Revised 2014 State Budget.
In the face of the differences in the discourse, a survey institute has
suggested that Jokowi follow the step once taken by former Argentine
president Carlos Menem regarding inconsistent government policy.
"Former Argentine president Carlos Menem once promised during
campaigning that his government will not sell state companies and will
not increase external debts. However, when he was elected, the policies
he implemented were all contradictory. He privatized state companies. In
the political perspective, he was ruined but was able to advance the
Argentine economy," Kuskridho Ambardi, the executive director of the
Indonesian Survey Institute, said.
Kuskridho added that although he sold state-owned companies and ruined
his political promises, yet Carlos Menem was able to cut unemployment
rate and in the following presidential race he was re-elected.***2***
(T.A014/INE/B003)
EDITED BY INE
(T.A014/A/BESSR/Bustanuddin) 02-09-2014 22:47 |
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