Energy subsidies will increase in 2023: officials

Jakarta – The Minister of Energy and Mineral Resources (EMR) Arifin Tasrif told the media that the conflict between Russia and Ukraine that has not yet subsided could push energy sector subsidies to increase again in 2023.

“We estimate the amount of subsidy allocation is quite large this year. We know that the conflict between Russia and Ukraine is still not over, of course this will cause a decrease in supply due to the obstruction of large supplies coming from Russia,” he said.

Furthermore, Tasrif said, apart from the conflict between Russia and Ukraine, the increase in energy subsidies is also likely to occur due to increased demand from China and also several other countries.

He said in 2022, the achievement of the EMR sector’s non-tax state revenue surpassed IDR 315 trillion, up 138% from the target this year of IDR 245 trillion. Tasrif said that the achievement was supported by a windfall in 2022, where commodity prices rose significantly.

Meanwhile, information from the Ministry of Finance states that realisation of energy subsidies and compensation in 2022 will swell to IDR 551.2 trillion. The subsidy is equivalent to 17.9% of total state spending last year. The realisation of energy subsidies in 2022 will also exceed 109.7% of what was planned in Presidential Decree 98/2022, namely IDR 502.4 trillion. (Hartatik)

Banner photo: Source: Pertamina

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