Prices Go Up, Compensation Scheme Doesn’t
The government budgeted Rp800 billion, the money it planned to save by reducing fuel subsidies. It was supposed to compensate the poor for this month’s price hike. But prices are already up, while the compensation program is not.
October 2, 2000
It is like a soap opera with a predictable plot. The domino effects of the 12 percent fuel price increase have already started. Even before the hike came in on October 1 the prices of other goods had started going up, says Umar Juoro, a researcher from the Center for Information and Development Studies (CIDES). Among other effects, it is expected to increase the inflation rate by one to two percent.
Besides inflation, it also has the potential t
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