Develop the local market

Develop the local market

The appreciation of the rupiah's value against the dollar,
though encouraging, must be greeted with caution because this
current is caused more by a weakening of the dollar than by a
strengthening of the rupiah. The rupiah's appreciation is thus,
more than anything else, the result of an external factor -- that
is, the projected decline of the U.S. economy, which has prompted
that country's central bank to lower the interest rate by 0.25
percent.

Economists and market analysts are generally agreed that the
American economy will suffer a decline in the coming year as a
result of the protracted crisis in Asia and Eastern Europe. Some
experts even believe that a recession could set in.

Any economic setback in the United States, which has so far
been the most important export market for Indonesia, naturally
holds the potential to make things even worse for us. Japan,
which is also one of our major export markets, has still not
recovered, while the European Union seems occupied with its
Eastern European neighbors, who are suffering under a no less
severe economic crisis.

We, for our part, should regard such projections as a warning
signal that the export market cannot always be depended on. It
appears prudent that we start making the domestic market a
primary means of support for our national economy. We hope that
the government can soon start taking more significant steps
towards exploiting our domestic market's potentials, particularly
by improving the public's purchasing power. If necessary, this
could be achieved by reducing taxes.

-- Bisnis Indonesia, Jakarta