Jakarta  (ANTARA News) - Finance Minister Sri Mulyani Indrawati believed the International Monetary Fund (IMF)`s statement calling for developing nations to reduce debts to avoid a risk of global economic slowdown was not relevant to Indonesia.

The IMF call is addressed to a number of countries whose ratio of debts to gross domestic product (GDP) is high and fiscal deficit has not met safe category, she stated in a discussion here on Tuesday. She noted that the ratio of government`s debts to GDP reached 29.9 percent as of late November 2018, well below the international prudential standard of 60 percent.

"Compared to the international standard, (the ratio of our debts to GDP) is still too low. Our budget deficit, which stands at 1.76 percent of GDP, is also small. Some other countries have ratio of debts to GDP at above 60 percent, but their budget deficit is 2 percent," she remarked.

"So (the IMF) statement is not relevant to Indonesia. Our (debt-to-GDP ratio) is getting smaller," she added. The IMF statement is relevant to countries whose ratio of debts to GDP is high and budget deficit is increasing. One of the countries is Italy, whose debt-to-GDP ratio reached 100 percent, with budget deficit exceeding 2.4 percent of GDP. "The country must maintain its fiscal balance by lowering deficit and reducing debts without weak growth," she explained.

Speaking at a press conference in Davos, Switzerland, recently, IMF Executive Director Christine Lagarde revealed that reducing government debts is one of the ways to reduce a risk of global economic slowdown.

Source: https://en.antaranews.com/news/121966/imfs-call-for-debt-cut-not-addressed-to-indonesia-finance-minister