Indonesia raised economic growth forecast to 6.4 percent next year from the initial target of 6.3 percent on the good prospect of investment, Jakarta Post said Wednesday.
Agus Supriyanto, a Finance Ministry official, said the investment optimism was based on an expected improvement in the country's sovereign debt ratings next year.
Indonesia's economy is predicted to grow by 6 percent this year.
Finance Minister Agus Martowardojo said the government would increase its spending in a bid to achieve the new growth target.
"We are committed to put all the additional budget into infrastructure spending," he said.
Darmin Nasution, the central bank governor, warned that Indonesia may see stronger inflationary pressure from the impact of unpredictable weather on the production of commodities, including food. Inflation can weaken household spending, the backbone of the economy.
"This year we are seeing abnormal weather hamper food supply," Darmin said. "There are risks this will happen again next year." He said 6.4 percent growth was the optimum and it deserved a major effort to reach./.