Govt determined to push exports higher: Dorodjatun
The Jakarta Post, Jakarta
The government is determined to continue to improve the competitiveness of the country's export industries in a bid to boost exports amid tougher global competition, Coordinating Minister for the Economy Dorodjatun Kuntjoro-Jakti has said.
"Indonesia is the most open economy in the world, judging from the fact that more than half of our gross domestic product (GDP) is generated from international trade.
"Based on this, exports are the top target for being given a boost," Dorodjatun said when delivering his keynote speech at a seminar on the economy and investment here on Tuesday.
He stopped short of explaining the steps to be taken to get there, but for a start, he added, the government would do its utmost to maintain a stable macroeconomy and would follow by making improvements to microeconomic areas, which would help spur exports.
"The government is striving to improve the climate for exports, including taxation, and an efficient bureaucracy. We're striving also to maintain rupiah stability, so that entrepreneurs can enjoy certainty in business," he said.
While details remain scarce, his remarks would appear to indicate the government's will to improve exports, whose contribution to growth has been somewhat disappointing.
Exports, along with investment, have contributed only a little to overall economic growth over the past few years, leaving only domestic consumption as the main engine for growth.
But since consumer spending has started to slow down, the government is now left with no choice but to jack up exports in order to push growth to a sustainable level that could help create more jobs and reduce poverty.
Currently, net exports make up less than 10 percent of the country's GDP.
However, signs of improvement are already apparent, as data unveiled by the Central Bureau of Statistics (BPS) on Monday showed that exports turned out to have increased by 1.21 percent in 2002, compared with the year before.
The country's full-year exports stood at $57.0 billion, as against $56.32 billion recorded in 2001, with non-oil and gas exports rising by 2.8 percent, from $43.7 billion to $44.9 billion.
Initially, many predicted that exports in 2002 would decline amid a host of uncertainties at home and economic recession in developed nations.
The better-than-expected export performance should provide a good foundation on which to boost exports this year as one of the main drivers of the economy, targeted to grow by 4 percent.
Dorodjatun believed that exports could expand further this year by maximizing sectors with development potential, notably agriculture and low-end manufacturing, apart from the mining sector.
Echoing Dorodjatun was deputy chairman of the Indonesian Employers Association (APINDO) Djimanto, who said that export performance could fare better than ever given its huge potential.
"However, if we're talking about competitiveness, our products could be far more competitive than they are currently in the global market, if the government provided some sort of incentives that would reduce high costs in the economic process," Djimanto told The Jakarta Post.
He added that currently, export products were less competitive for a variety of reasons, including confusion over some tax regulations, red tape and other bureaucratic constraints at customs offices.