RI on track to get investment grade

Indonesia’s debt is well on track to achieve an investment grade in line with the continued improvement of the country’s economic fundamentals, a senior Bank Indonesia official has said.

Perry Warjiyo, the central bank’s director of monetary policy research, said the world’s major
rating agencies had continued to positively rate Indonesia’s economic performance.

Perry said that based on the statements made by several rating agencies during a recent meeting, “we are optimistic that we will get the rating upgrade to investment grade next year”.

He added that in the meetings, the central bank convinced the agencies that the country’s macroeconomy was stable and that the debt-to-GDP (growth domestic product) ratio was lowering.

In the 2011 state budget recently approved by the House of Representatives, the debt ratio against the GDP was set at 26 percent, or lower than this year’s 27.4 percent.

In 2009, the ratio stood at 30 percent and it reached 54 percent in 2004.

Indonesia’s economy has grown in the 4-6 percent range in recent years and is expected to expand by 6.3 percent in 2011.

The government has also forecast the economy to grow up to 7.7 percent by the end of President
Susilo Bambang Yudhoyono’s tenure in 2014.

The world’s three major rating agencies — Moody’s Investors Services, Standard & Poor’s (S&P) and Fitch Ratings — have upgraded Indonesia’s sovereign debt rating this year to one and two notches below investment grade.