'High interest rates only hurt people'

To curb the rapid fall of the rupiah against foreign currencies, Bank Indonesia increased the interest rate of its promissory notes, which prompted commercial banks to raise their interest rates. The Jakarta Post talks to residents to get their opinion on the issue.

Midya Nur Wulan Santi, 23, a reporter for a women's magazine who lives in Kalimalang, East Jakarta.

Though the policy doesn't affect me, I feel sorry for those who have loans or run businesses. They may have difficulties in repaying their loans and managing their finances. Hopefully, it won't force them to close their businesses.

In my opinion, what Bank Indonesia did -- raise the rate -- will only work for a while. I don't think it will effectively bring the rupiah back to its previous level.

I haven't see any significant change in the rupiah's exchange rate since the new rate was introduced.

However, maybe the rupiah would be worth less if the government did nothing.

I don't know what exactly should be done, but I think what the government should probably do is improve law enforcement, so that the business climate improves.

I think many investors would invest in Indonesia if the situation was conducive to business. If this happened, it'd help bring the rupiah back to its former worth.

Erlangga Aditya, 31, is a broker at the Jakarta Stock Exchange.

I understand that the policy is necessary to anticipate higher inflation, but it was introduced a bit late.

It sure does have an impact on people, especially business entities with large debts. Basically, I don't think the greater public will feel a significant impact, except for slightly higher interest on their loans.

It's the government's obligation to pass on the message of the importance of every policy it makes, including for this one.

People, even businesspeople, must understand that it was necessary despite the heavier burden it may put on them.

The Jakarta Post