Program for Economic Resilience, Investment and Social Assistance in Indonesia

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The development objective of the Economic Resilience, Investment and Social Assistance Program for Indonesia is to enhance the Government's crisis preparedness to address the potential adverse impact of ongoing volatility in financial markets on Government's ability to meet its gross fiscal financing needs from markets. The Program for Economic Resilience, Investment and Social Assistance in Indonesia (PERISAI), in the form of a USD 2 billion Development Policy Loan (DPL) with a Deferred Drawdown Option (DDO), is designed to enhance the Government of Indonesia's crisis preparedness to address the potential adverse impacts of continued international financial market volatility on Indonesia's economy. Like many other developing economies, Indonesia has had to cope with increased volatility in financial markets and a slowdown in growth in the developed countries that has significantly weakened the external environment. Turbulence in international financial markets in the second half of 2011 has contributed to financial account outflows. Indonesia is also preparing for a possible domestic growth slowdown or further tightening in global liquidity conditions in 2012. The Government has responded proactively to enhance its crisis preparedness, and the World Bank and other partners continue to support these efforts. The Government has stated that this support package will serve primarily as a signaling mechanism to the markets and that it intends to draw down the support only in the event of a significant worsening of the financing conditions. Indonesia is now in a relatively strong position to weather the increasing international economic and financial headwinds. Real Gross Domestic Product (GDP) growth for 2011 moved up to 6.5 percent, the highest since the Asian financial crisis, and absent a significant worsening of external conditions, or domestic policy missteps, the Bank projects only a slight growth slowdown to 6.1 percent in 2012. The 2012 revised budget provides the Government with significant flexibility to respond to evolving economic conditions. The Budget focuses on the medium term growth agenda, with an increased allocation to sectors such as infrastructure, education and agriculture, as well as enhanced crisis preparedness.

FY17 - Financial Sector,FY17 - Public Administration,FY17 - Social Protection

World Bank Group

Project

Residential, Commercial, Raw Materials, Government, Education