Tue, 23 Aug 2011

Jakarta (ANTARA News) - Economist Guntur S. Siboro predicted here on Tuesday that the current financial crisis in the US and Europe would encourage foreign investors to shift their funds to Asia.

Thanks to its better economic growth, Asia, particularly Indonesia, would be flooded by foreign funds, and therefore Indonesia should not be worried about the financial crisis in the US and Europe, he said.

Some parties were indeed worried the financial crisis in the US and Europe might trigger a global economic crisis similar to that in 1997-1998, he said.

He believed Indonesia`s economy would grow faster supported by the consumption, investment and export sectors.

Indonesia had no reason to worry about the crisis in the US and Europe because its exports to the two regions were not significant, he added.

Foreign investors were most likely to put their money in markets promising high profits such as Indonesia whose key interest rate was 6.75 percent, Guntur, the marketing director of PT Karyamegah Adijaya, said.

The country`s growing economy was the main factor encouraging foreign investors to choose the domestic markets, he explained.

"Indonesia is rich in natural resources and it can meet its own needs if its natural resources are managed properly," he said.

The country has reached a rice production surplus and canceled its plan to export rice as reported earlier.

The government should give incentives to boost the production of commodities such as paddy, sugar, rubber and spices, to meet domestic demand, he said.