In a review of the government's performance in 2007, the Indonesian Chamber of Commerce and Industry (Kadin) says that it is disappointed with the government's economic plans and their implementation.
Kadin's economic research team head Faisal Basri said Tuesday that the government had failed to come up with reliable economic forecasting, which led to a series of problems hampering progresses and growth.
"The government has continued to produce inaccurate economic predictions since 2005," said Faisal during the inauguration of the new research team in Jakarta.
Faisal highlighted the government's critical failure in using the US$60 barrel oil price as an assumption in this year's state budget planning.
Oil prices now hover above $90 per barrel, pushing up the prices of staple foods and other products, forcing the government to revise the state budget far earlier than usual.
"For the first time in our history we had to revise the national budget just one month after it was finalized," Faisal said.
The eight economists on the team identified the coming threat of skyrocketing oil prices as early as 2006, but their warning was not taken seriously by the government, he said.
Another member of the team, Anton Gunawan, said that Indonesia was currently experiencing a dangerous "policy and institutional deficit".
"Our institutional framework doesn't reflect the government's goals of increasing work opportunities and lowering the level of poverty. And we don't even have any decent framework for implementation," said Anton.
The chamber suggested the government manage itself more efficiently and "really listen" to their recommendations, as well as be more sensitive of international trends in devising its policies, particularly the national budget.
Also speaking at the inauguration, Kadin chairman Mohammad Hidayat said that the government needed to move beyond a "business as usual" work ethic to avoid repeating failures in its economic policies.
Although some of the chamber's short-term economic resolutions were adopted by the government through its food resilience policy, Hidayat said that the government should also implement recommendations with long-term impacts.
"Farmers need to get a financial guarantee from the government for any harvest failure caused by nature. This will bring back their spirits," he said as an example.
As a result of those failures, Hidayat said, citing the International Institute for Management Development's World Competitiveness Yearbook 2007, Indonesia was ranked 54th for the year, down one spot from last year. (lva)
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