Business confidence weakens due to terror

Business confidence weakens due to terror

The Jakarta Post, Jakarta

The upward trend in business confidence in the country was
halted in August and September due to the impact of the Marriott
Hotel bombing, the Danareksa Research Institute said in its
regular survey on Friday.

The business sentiment index (BSI) during the two months stood
still at 110.6, defying the previous trend which saw the index
rising until July, the survey said.

"Businesspeople are now monitoring cautiously the aftermath of
the atrocity, notably the government's policy response to the
terrorist assault on Indonesia's soil," it said.

It added that the attacks interrupted the upward course of
momentum that had begun at the start of the second half of the
year following a slump in the previous nine months.

The bombing took place on Aug. 5 and left more than 10 people
dead, while also prompting concerns among many that it would slow
the pace of the country's economic recovery.

Danareksa added, however, that a halt to the upward move of
the BSI did not necessarily mean a loss of business confidence.
"The blast neither shattered Indonesia's economic fundamentals
nor narrowed the nation's recovery prospects."

The survey showed that confidence in economic recovery in the
last quarter of the year and first quarter of next year remained
strong, and had even strengthened.

Business momentum remains because of the police's quick
response to the tragedy, helping to prevent a collapse of
sentiment, the survey said.

The survey questioned more than 700 chief executives or
directors representing a wide variety of leading companies in
various sectors, namely construction, agriculture, finance,
transportation and communications, manufacturing, hotel and
restaurant services, and others.

The survey is designed to measure the CEOs' assessments of the
current economy and business conditions, and their expectations
for the next six months.