IMF calls on statistics agency to improve methodologies

Urip Hudiono, The Jakarta Post, Jakarta

In anticipation of increased economic activity and to provide a more accurate picture of the country's condition, state statistics agencies must continue improving their methodologies, says an International Monetary Fund (IMF) statistical system assessment mission.

Mission head William Alexander said on Tuesday the existing system was good enough but still had room for improvement to anticipate rapid changes due to globalization and recent decentralization.

"The statistical system in Indonesia actually compares very favorably with other countries in the region, having a number of strengths which are very important," he said.

One of the strengths, he added, was that the legal and institutional framework underpinning the whole statistical system has been strong, providing a basis to protect the independence and objectivity of the statistics.

"The government does not have access to most statistics produced in Indonesia before they are released to the public," he said. "As a result, we have a lot of confidence in the results."

Alexander explained that the mission had also found that the level of resources allocated for statistical surveys was large compared to other countries.

"The staff of the statistical system are highly professional and well trained. They also have been keen to uphold the quality of their statistical products."

However, the country's statistical system still faces some problems due to the fact that Indonesia is growing rapidly and as a result of globalization.

"Indonesia's statistical system must be constantly on guard to capture new forms of economic activity and adequately report them," he said.

Alexander gave as an example the importance of capturing new activities in the service sector as well as keeping surveys of businesses updated on a regular basis for the national accounts statistics.

In the case of monetary statistics, new products and institutions also emerge almost on a daily basis.

"Take for example mutual funds, which is a form of depository institution," he said.

On the government's finance statistics, the issue of decentralization has created a need to monitor regional administrations and strengthen the statistical base there.

"It is also important that the activities of off-budget organizations be captured," he said.

The IMF mission is expected to wrap up its assessment and publish the results next week in its Reports on the Observance of Standards and Codes for Indonesia.

The reports will include compliance of 12 international standards, including the fund's transparency principles, the Basel prudent banking practices and Financial Action Task Force's antimoney laundering recommendations.

The Central Statistics Agency (BPS) publishes macroeconomic indicators such as gross domestic product growth, the inflation rate and trade balance, while Bank Indonesia publishes monetary statistics such as foreign exchange reserves and the country's balance of payments.