A lesson from Argentina<\/p>\n
Don't cry for me, Argentina. This is the song that
\nappropriately paints the ups and downs and patriotism of the
\nlegendary Eva Peron.<\/p>\n
Argentina was assaulted by unrest last week after the country
\nbecame bankrupt due to its economic recession. The main cause was
\nthe huge foreign debt, amounting to US$ 132 billion.<\/p>\n
Today the state of the country in the southern part of the
\nAmerican continent is worse than Indonesia's, so the new
\ngovernment has taken a drastic decision by stopping loan
\nrepayments and by issuing the \"argentino\", a new currency
\nalongside the peso and the US dollar.<\/p>\n
This Latin American country has some similarities with
\nIndonesia. Both have been clients of the International Monetary
\nFund (IMF) for the past four years. There has been a rapid
\nsuccession of presidents in both countries because they were
\nconsidered to be incapable of solving their country's crisis.<\/p>\n
Both countries are also going through a crisis caused by the
\nhuge amount of loan debt. However, the structure of the debts is
\nslightly different.<\/p>\n
Indonesia's situation is indeed better than Argentina's.
\nIndonesia's debt is much smaller -- only half of Argentina's --
\nwhile our economy is far larger. Pegging the exchange value of
\nthe peso equal to that of the US dollar apparently did not do
\nmuch to help the hemorrhaging economy. If its currency exchange
\nrate were as free as Indonesia's, probably the collapse of
\nArgentina's economy would have been earlier.<\/p>\n
Besides, Indonesia has far more natural resources compared
\nwith Argentina.<\/p>\n
Fiscal and monetary tightening have always been the IMF's
\nclassical move whenever it assists in the economic recovery of
\nany country, although the results have yet to be clearly seen.
\nArgentina has served as an example by becoming the victim of the
\nIMF's failure.<\/p>\n
-- Bisnis Indonesia, Jakarta<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/a-lesson-from-argentina-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }