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"We still have time until the end of September, 2020 to increase our leverage, increase people's
purchasing power, increase household consumption in the third quarter, so I ask all cash transfer
incentive programs to be accelerated," the President said.

The third quarter of 2020 must serve as a momentum for economic recovery as well as an
opportunity for Indonesia to avoid an economic recession, he added.

In the second quarter of 2020, Indonesia's economy had contracted to minus 5.32 percent. If
the country experiences negative economic growth again in the third quarter of 2020, it will enter
a recession.

Several types of social assistance has been provided by the government during the six months
of the COVID-19 pandemic, including basic food assistance, cash social assistance, and Village
Fund Direct Cash Assistance, under which a portion of the budget was transferred to beneficiary
families (KPM).

The government has also provided discounted tariffs to free electricity, subsidies through pre-
employment cards, salary subsidies for workers earning less than Rp5 million, and Productive
Presidential Assistance (Banpres) of Rp2.4 million for micro and small businesses.

President Widodo has also launched monthly wage subsidy assistance of Rp600 thousand, which
is meant to be disbursed for a four-month period, for 15.7 million workers drawing a monthly
salary of less than Rp5 million.

While launching the cash assistance-based incentive at the State Palace in Jakarta on Thursday,
President Jokowi revealed that the salary subsidy will initially be distributed to 2.5 million workers
and thereafter, dispensed gradually to another 15.7 million formal workers. The aid will be
distributed stage-wise until the end of September, 2020.

Under the first stage, salary subsidies were to be distributed via bank transfer every two months,
for a period of four months. Thus, in the first stage, salary subsidy assistance of Rp1.2 million
has been distributed, while the rest will be disbursed over the next two months.

"Today, I think workers, who receive wage subsidy assistance, include honorary teachers,
honorary firefighters, honorary hotel employees, and nurse medical personnel, what else? There
are cleaners, hotel employees, and others. Those actively paying the Workers Social Security
Agency (BPJS Ketenagakerjaan) fees will be offered wage subsidy assistance," President Jokowi
informed.

The launch of the scheme was also attended by Coordinating Minister for Economic Affairs,
Airlangga Hartarto, State-Owned Enterprises Minister Erick Thohir, and Minister of Manpower,
Ida Fauziyah.

One of the criteria for workers to receive subsidized wages is they need to be active participants
of BPJS Ketenagakerjaan and diligent about making contributions. President Jokowi said he is
optimistic that the salary subsidy assistance would encourage public consumption.

"We are upbeat that, once again, household consumption will not be disturbed, and the people's
purchasing power will increase. We are optimistic that our country's economic growth will return
to normal," President Jokowi stated.

The head of state remarked that the salary subsidy is part of a series of aids that the government
is providing to the public to reduce the social and economic burden caused by the COVID-19
pandemic. (INE) Related news: Jokowi launches wage subsidy assistance for 15.7 million
workers Related news: Wage subsidy assistance launched on August 27, 2020: Manpower
minister EDITED BY INE.

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