RI must do some homework to meet APEC goals: Experts<\/p>\n
Berni K. Moestafa, The Jakarta Post, Jakarta<\/p>\n
Last week's summit of the Asia Pacific Economic Cooperation
\n(APEC) forum in China provided Indonesia with few clues on how to
\ntackle the global economic downturn, which has slowed
\npreparations for a free trade area, other than to press the
\ngovernment to do its homework better, economists said.<\/p>\n
Economist at the Institute for Development of Economics &
\nFinance (Indef) Dradjad H. Wibowo said APEC's joint declaration
\nwas strong in words but weak in details.<\/p>\n
\"The APEC declaration is a generic statement, acceptable to
\nall members,\" Dradjad told The Jakarta Post.<\/p>\n
APEC's 21-members vowed in a joint declaration to revive their
\neconomies, but refrained from citing supporting measures.<\/p>\n
Ending last Sunday, the summit marked the first opportunity
\nfor world leaders to discuss the devastating impact of last
\nmonth's terrorist attacks in the U.S. on the global economy.<\/p>\n
These attacks have left a gaping hole in world trade,
\ntriggered by a sharp plunge in U.S. consumer and business
\nconfidence.<\/p>\n
In its draft, the APEC declaration called on members to
\nundertake pro-growth fiscal and monetary policies to overcome the
\nslump. But Indonesia could do neither, Dradjad said.<\/p>\n
\"Some countries like Indonesia can't provide much fiscal
\nstimulus given their budget deficits... a monetary stimulus is
\nalso unlikely as it is not the time yet to lower interest rates,\"
\nhe said, adding that every nation had its own ways to revive the
\neconomy.<\/p>\n
China, for instance, would likely seek to revitalize its
\nindustries amid a slump in exports to the U.S., he said.<\/p>\n
Elsewhere, the Malaysian government might review its capital
\nregime. Foreign funds had fled the country after having been tied
\nto the ringgit for a year under the country's limited capital
\ncontrol policy, he said.<\/p>\n
As for Indonesia, the APEC declaration simply reminded the
\ngovernment to do its homework, which is to stick to the economic
\nreform program.<\/p>\n
The program's aim is to purge the country's economy of
\ninefficiencies, which should lure foreign and domestic
\ninvestment, while fortifying the economy from external shocks.<\/p>\n
It also forms part of an agreement with the International
\nMonetary Fund (IMF) to obtain financial aid.<\/p>\n
Dradjad said old problems such as security and
\ndecentralization must also remain the government's priority.<\/p>\n
Separately, senior economist at the Advisory Group in
\nEconomics, Industry and Trade (Econit) Hendri Saparini said the
\ngovernment had come to the APEC summit unprepared.<\/p>\n
\"The government had not fully utilized the opportunity to
\npresent its position during the APEC meeting,\" she said.<\/p>\n
According to her, the government has yet to map out
\nIndonesia's competitive advantages in global trade.<\/p>\n
\"All our industrial sectors are short of competitive
\nadvantage.\"<\/p>\n
\"Without us knowing where our strengths lie, we can't map out
\nthe competition or have a clear strategy,\" she said.<\/p>\n
So far, she added, it remained unclear how Indonesia would
\ncope with next year's ASEAN Free Trade Area (AFTA).<\/p>\n
Given this situation, it would be difficult for Indonesia to
\nremove trade barriers with APEC members, she said.<\/p>\n
Commenting on the measures to revive the economy, Hendri
\nadvised the government to re-allocate its spending on sectors
\nthat drive economic growth.<\/p>\n
\"Conditions for next year have altered. Instead of foreign
\ndebt payments, we must allocate our spending more at home,\" she
\nsaid.<\/p>\n
That would call for the pushing of debt rescheduling talks in
\nthe upcoming meeting of the Paris Club of creditor nations.<\/p>",
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