Healthy competition vital for growth: Experts<\/p>\n
JAKARTA (JP): Indonesia needs to complement its very strong
\ncommitment to development with a pricing policy and healthy
\ncompetition to sustain high economic growth for the next 30
\nyears, an expert said.<\/p>\n
Peter McCawley, deputy director general of the Australian
\nAgency for International Development (AusAID), said here
\nyesterday that pricing and market mechanism in Indonesia, like in
\nother Asian countries, was still quite distorted.<\/p>\n
\"The lesson we can derive from our experience over the last
\nfour months is the pricing of exchange rates, whether they are
\novervalued or undervalued,\" he said referring to the currency
\ncrisis sweeping Southeast and East Asia.<\/p>\n
Another problem of pricing was in infrastructure, where prices
\nwere too low, he said.<\/p>\n
\"I know this is an old song I have sung since 30 years ago
\nwhen I said the price of electricity here was too low,\" McCawley
\nsaid at a seminar hosted by the Centre for Strategic and
\nInternational Studies (CSIS).<\/p>\n
\"If you keep prices badly out of the line for a long time,
\nthere are many consequences. So, it is very important to get the
\nprices of infrastructure right,\" he added.<\/p>\n
Besides bad pricing, Indonesia -- like most Asian countries --
\nis still plagued by market distortions like monopoly and
\noligopoly.<\/p>\n
One of the things the government needs to do in its economic
\npolicy is to get the market to work, and then it would become the
\ncentral issue of economic policy for the next 30 years.<\/p>\n
\"If you look across Asia, there are many markets that work
\nbadly. This is a major challenge for all of us to try to improve
\nthe functioning of the market,\" he said.<\/p>\n
McCawley praised President Soeharto yesterday for his strong
\ncommitment to development, which he said had contributed largely
\nto the success of Indonesia's economy.<\/p>\n
\"One of the things he has is a very strong commitment to the
\nnation, to promote the central idea of development. You think
\nmaybe it is so simple, it doesn't matter, but it is extremely
\nimportant.<\/p>\n
\"I have visited many countries where commitment to development
\ndoes not exist, and there is a great difference between the
\ncountries where commitment to development exist and where it
\ndoesn't,\" McCawley said.<\/p>\n
He said Soeharto's commitment to development had resulted in a
\ntremendous 7 percent growth per annum for the country for the
\nlast 30 years.<\/p>\n
\"Don't forget what has been achieved... But it is only a
\nstart. What we have to focus on is how we can get 7 percent
\ngrowth per annum for another 30 years,\" he said.<\/p>\n
He contended that if Indonesia failed to achieve high growth
\nfor the next 30 years, it would face enormous problems, ranging
\nfrom unemployment to environmental degradation and mass poverty.<\/p>\n
\"I see no way of overcoming mass poverty across the developing
\nworld unless we can have sustained economic growth of around 7
\npercent or 8 percent per annum for the next 30, 40 or 50 years.<\/p>\n
\"You see from this point of view, I'm not so interested in
\nwhat the IMF (International Monetary Fund) is doing in Indonesia
\nright now. Of course it is important for short-term measures. But
\nthe main goal is to return to the high rate of growth,\" he said.<\/p>\n
He noted that the emphasis on growth would not automatically
\nneglect equal distribution of wealth among people as both issues
\ncould be addressed at the same time.<\/p>\n
\"I don't think there is a conflict, we can pursue a policy to
\nsustain high growth and improve income distribution at the same
\ntime. And we should pursue both at once,\" he said.<\/p>\n
He said he was \"cautiously optimistic\" about the prospects of
\nIndonesia's economy.<\/p>\n
He suggested that Indonesia keep going ahead with its economic
\nreforms, which are supported by the IMF, but without in any way
\nsacrificing growth.<\/p>\n
\"The single most important lesson for economic policy makers
\nis always concentrated on good policy to promote long-term
\neconomic growth. We must keep our eye on that main goal,\" he
\nsaid. (rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/healthy-competition-vital-for-growth-experts-1447893297",
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