BI Targets 11% Credit Growth
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According to him, the target is expected to be reached due to the influx of fresh funds into financial institutions through the tax amnesty.
“We consider that the tax amnesty will bring enough funds,” he said in Jakarta on Friday.
The estimate, however, is lower than that of the original target of 12.7 percent.
According to Agus, the change coincided with the approval of the 2017 economic growth target of 5.1 percent.
Assumptions credit growth of 12.7 percent, he said, is met if the government and the House of Representatives agreed on economic growth target of 5.2 percent.
The cause of the slow growth of credit is the weakening global economic growth, which is below 3.5 percent, he added.
Questions & Answers
Q.What is the new credit growth target set by Bank Indonesia for next year?
What is the new credit growth target set by Bank Indonesia for next year?
Bank Indonesia is targeting bank credit growth of 11 percent for next year. This updated figure is lower than the initial target that had been previously considered.
Q.Why does Bank Indonesia expect to achieve this credit growth target?
Why does Bank Indonesia expect to achieve this credit growth target?
Bank Indonesia expects to achieve the target due to an anticipated influx of fresh funds into financial institutions. This influx is predicted to come from the ongoing tax amnesty programme.
Q.What factor influenced Bank Indonesia to lower its credit growth target?
What factor influenced Bank Indonesia to lower its credit growth target?
The change in the credit growth target coincided with the approval of a 5.1 percent economic growth target for 2017. A higher economic growth target would have supported the original credit growth assumption.
Q.What is the primary reason given for the general slowdown in credit growth?
What is the primary reason given for the general slowdown in credit growth?
The governor stated that the slow growth of credit is primarily caused by the weakening global economic growth. This global growth is currently estimated to be below 3.5 percent.
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