ANALISIS HUBUNGAN DEFISIT KESEIMBANGAN PRIMER TERHADAP PERTUMBUHAN EKONOMI DI INDONESIA

Abstract

The state budget is said to be healthy when it has a lower budget deficit even towards a surplus and
positive primary balance. From 2010 the Indonesian State Budget shows a budget deficit and the
primary balance has also shown a negative trend since 2012. In the case of the primary balance
and the State Budget experiencing a deficit, it can be indicated that a country’s spending exceeds its
revenue. This expenditure issued by the government is closely related to economic growth, where the
economic growth of a country can be measured by GDP. Keynes theory assumes that government
intervention in the economy determines economic development can run optimally. Based on the
theory as well as previous research, it is known that there is a relationship between the primary
balance deficit on economic growth. If a country experiences a primary balance deficit, it is certain

that state spending will be greater than state revenue. This means that the government is intensively
carrying out development and stimulus to several sectors in the context of economic growth. It is
hoped that the increased economic growth will reduce unemployment, increase the competitiveness
of domestic products and attract investors to invest their capital. In addition to fiscal policy, there is
monetary policy adopted by Bank Indonesia in an effort to increase GDP through various monetary
instruments, such as open market operations and standing facilities. The primary balance deficit
is not a good thing because there is interest debt that must be paid and the nominal interest debt
increases every year if the budget is in deficit. In an effort to reduce the primary balance deficit,
there are several steps that can be applied, including maximizing the potential of state revenue
and state expenditures, saving operational costs, strict supervision of budget use, enforcement of
security and order and applicable laws to restore investor confidence.