Susilo warns global economic slowdown could affect RI<\/p>\n
Rendi A. Witular, The Jakarta Post, Jakarta<\/p>\n
President Susilo Bambang Yudhoyono warned on Tuesday that the
\ncountry's economic growth might remain sluggish unless the
\ngovernment and the business community managed to anticipate the
\nimpact of a projected global economic slowdown this year.<\/p>\n
Speaking in front of the Indonesian Economists Association
\n(ISEI) at the State Palace, Susilo quoted the World Bank's 2005
\nGlobal Economic Prospect report, alerting the country to seek
\nsmart ways to improve the economy.<\/p>\n
\"There is a worrying projection from the World Bank over a
\npossible slowdown in the global economy which may affect us. We
\nare currently trying to make the economy competitive and
\nefficient to help reduce the impact of the slowdown,\" he said.<\/p>\n
According to the World Bank, global economic growth is
\nexpected to slow in 2005 and 2006 -- expanding by 3.2 percent
\neach year from 4 percent in the previous years on average -- due
\nto a number of factors.<\/p>\n
Indonesia expects its economy to grow by 5.5 percent this
\nyear, and 6.6 percent on average over the next four years, with
\ninvestment and exports being the engines of this growth.<\/p>\n
Since the 1997 economic crisis, the country has been relying
\nheavily on domestic consumption to push economic growth, as
\ninvestors and exporters remain wary due to the poor business
\nclimate here.<\/p>\n
\"Our efforts to make the economy efficient is to combat
\ncorruption, prevent illegal fees and smooth bureaucratic
\nprocedures. Without such efforts, we can't compete with the
\nemerging economic powers of China and India,\" said Susilo.<\/p>\n
Previous surveys have ranked Indonesia's bureaucracy as
\ncorrupt and inflexible, with the country being one of the most
\ndifficult places in the world to do business.<\/p>\n
While admitting that bribery and corruption were still rampant
\nwithin the bureaucracy, the President promised to reduce it by
\nmaking the government more transparent, efficient and accountable
\nto the public.<\/p>\n
But an evaluation of his first 100 days in power showed that
\nhis government has yet to successfully tackle the one issue that
\nbusinesspeople constantly complain about: rampant corruption.<\/p>\n
Susilo underscored the importance for Indonesia to be \"smart\"
\nin marketing its products on global markets, and to use
\nalternative energy sources, such as gas, to reduce production
\ncosts.<\/p>\n
\"The government and the business community should be smart in
\nmarketing the country's manufacturing products overseas amid a
\nslowdown in demand,\" he said.<\/p>\n
At the meeting, Susilo also warned of the economic and social
\nproblems resulting from the rapid growth in the country's
\npopulation, which is increasing at the rate of 1.45 percent, or
\nabout three million people, annually on average.<\/p>\n
The country's population this year is estimated to reach 230
\nmillion.<\/p>\n
\"I am worried that our natural resources and economy can no
\nlonger support such huge population increase. That is why I have
\ntaken the initiative to revive the National Family Planning
\nprogram to help reduce birth numbers,\" said Susilo.<\/p>\n
The government has allocated some Rp 600 billion (US$64
\nmillion) this year for birth control programs. The funds will be
\ntaken from the government's low-income assistance funds derived
\nfrom the slashing of fuel subsidies.<\/p>\n
Drivers for global economic slowdown<\/p>\n
1. Investment cycle in the United States has likely peaked,
\nimplying a slowdown in the world's largest economy.<\/p>\n
2. World demand has outstripped supply, resulting in substantial
\nincreases in oil and other commodity prices that have cut incomes
\n-- moderating demand in many countries.<\/p>\n
3. Higher interest rates will slow investment growth as central
\nbanks continue shifting monetary policy from a loose to a more
\nneutral stance.<\/p>\n
4. The large fiscal impulse that has helped propel the U.S.
\neconomy in recent years will weaken, although the deficit remains
\nhigh; and in Europe, budgetary policy is expected to tighten as
\ncountries seek to regain control over deficits.<\/p>\n
5. Efforts in China to bring growth down to a more sustainable
\npace may also contribute to weaker, but still strong, demand over
\nthe medium term.<\/p>\n
Source: World Bank's 2005 Global Economy Prospect<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/susilo-warns-global-economic-slowdown-could-affect-ri-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }