The Indonesian government has projected that the country's economy will grow by 5.9 percent this year, or lower than the government-set target of 6.2 percent, a minister said.

"We predict it will be hard for the economy to grow by 6.2 percent. The most optimistic projection now is 5.9 percent," Antara news agency quoted Finance Minister Sri Mulyani as saying after a cabinet meeting on Friday.

The forecast was based on the assumption that inflation would remain at 8 percent, Bank Indonesia's benchmark interest for three- month deposits 12 percent, and global crude prices 60-70 U.S. dollars a barrel, and the rupiah's exchange rate against the dollar at 9,000 rupiah, she said.

Given the change in the assumption, a deficit in the 2006 state budget would increase to between 1 percent and 1.3 percent from the previous 0.7 percent of gross domestic product (GDP), she said.

Source: Xinhua