Import curb sought to ease account deficit<\/p>\n
JAKARTA (JP): The government should take down-to-earth
\nmeasures to curb import growth and drive up exports to reduce the
\ngrowing current account deficit, executives suggested yesterday.<\/p>\n
They said that without drastic measures it will be difficult
\nfor the government to reduce import growth from 32 percent last
\nyear to 11 percent this year and to achieve the projected 19.5
\npercent growth for exports.<\/p>\n
Chairman of the Indonesian Importers Association, Amirudin
\nSaud, suggested that the government introduce new policy
\ninstruments to curb imports, especially for consumer goods.<\/p>\n
\"So far the government allows everyone to import as many
\nconsumer items, like fruits and vegetables, as they want. Now, it
\nneeds to regulate this so that everybody, including foreign
\nrestaurants, will use domestic products,\" Amirudin said.<\/p>\n
In a press briefing on the 1996-1997 budget plan, Minister of
\nFinance Mar'ie Muhammad estimated that the current account
\ndeficit would expand to US$7.9 billion for the current fiscal
\nyear from $3.49 billion last fiscal year due to the higher growth
\nrate of imports than that of exports.<\/p>\n
Indonesia's non-oil exports grew by 14.2 percent during the
\nJanuary-September period of last year to $25.14 billion from
\n$22.02 billion in the same period of 1994. Meanwhile, imports
\ngrew by 32.4 percent during the same period of last year with
\nimports of consumer goods rising by 70.9 percent.<\/p>\n
Impossible<\/p>\n
However, some analysts consider it impossible for the
\ngovernment to slash import growth.<\/p>\n
\"I think it's almost impossible for the government to take
\nsuch a drastic cut in import growth given its expectation of more
\nthan 7 percent in economic growth,\" the President of PT Daiwa
\nIndonesia Securities, Mitshou Kiyokawa, said.<\/p>\n
In the same press briefing, Central Bank Governor J.
\nSoedradjad Djiwandono contended that the government would manage
\nto check growth of imports at 11 percent.<\/p>\n
\"Of course, we have to take a number of measures to reach the
\ntarget,\" Soedradjad said.<\/p>\n
He noted that Indonesia has experienced a sharp fluctuation in
\nimport growth. Imports grew by 21.3 percent in the 1999-1990
\nfiscal year. The import growth rate increased to 31 percent in
\nthe 1990-1991 fiscal year but dropped drastically to 11.4 percent
\nin 1991-1992, then it fell further to 9.7 percent in the 1992-
\n1993 fiscal year and 6.6 percent in 1993-1994.<\/p>\n
\"Therefore, it will not be impossible to reach the target as
\nthe growth rate of imports has not been steady,\" Soedradjad said.<\/p>\n
Laksamana Sukardi, chairman of the Reform Consulting
\nInstitute, suggested that the government \"adjust\" the exchange
\nrate or devalue its currency and reschedule large projects to
\ncurb import growth.<\/p>\n
\"That would make the target growth for imports more realistic.
\nHowever, both measures have no direct effects on exports,\"
\nLaksamana told The Jakarta Post yesterday.<\/p>\n
To achieve more exports, he suggested that the government take
\ndown-to-earth measures to abolish economic distortions created by
\nmonopolies, oligopolies, cartel-like practices and collusion
\nbetween officials and businessmen.<\/p>\n
\"We have exhausted all the alternatives, but still we could
\nnot strengthen our export competitiveness. We have no more
\nchoices but dismantling those anti-market practices,\" he said.<\/p>\n
Many expect better export performance with the recent merger
\nbetween the industry and trade ministries.<\/p>\n
When proposing the 1996-1997 budget plan to the House of
\nRepresentatives on Thursday, President Soeharto underlined the
\nobjective behind the merger of the two ministries.<\/p>\n
\"I have combined the industry ministry and the trade ministry
\ninto one ministry. Hopefully with this measure our effort to
\nincrease exports will have better direction and coordination,\"
\nPresident Soeharto said.<\/p>\n
Minister of Industry and Trade Tunky Ariwibowo told
\njournalists on Thursday that he will cut the \"input costs\" which
\nhave burdened exporters.<\/p>\n
\"The government will soon issue a new deregulatory package
\nwhich will, among other things, cut in input costs,\" Tunky said.
\n(13\/rid)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/import-curb-sought-to-ease-account-deficit-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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