Fuel price hike too abrupt

Fuel price hike too abrupt

It is extraordinarily surprising how few measures to tackle
inflation the government of Indonesia had put in place before the
shocking fuel price rise, which has had a big effect on the less
well-off.

Even to a non-economist, the rise raises concerns. The one-
time more-than-100-percent fuel hike was apparently carried out
without previous adjustments, such as a gradual reduction of the
fuel subsidies along a scheduled time-line, agreed upon by
stakeholders in advance, thus enabling a less-traumatic landing.
Neither was it enacted through a series of government provisions
regulating a gradual increase in prices of a "basket" of
consumable items considered fundamental for micro-economies.

With the out-of-control inflationary price escalation already
occurring, it seems only too evident that the already inequitable
and imbalanced distribution of wealth in this country is going to
be further skewed. No wonder, then, that the IMF praised the
government of Indonesia for the measure.

JUAN LUIS DOMMNGUEZ, Jakarta