Indonesia needs 2 to 4 years to recover

Indonesia needs 2 to 4 years to recover

JAKARTA (JP): Indonesia will need two to four years to recover
from the economic crisis, compared to other Asian crisis-hit
countries which will require two years to rebound, an economist
at Standard Chartered Bank said on Monday.

However, Indonesia will remain attractive to long-term
investors due to its strategic geopolitical position and large
market, said Wong Yit Fan, Standard Chartered Bank's chief
economist in Southeast Asia.

During the recovery period, the rupiah will not slide lower
than Rp 12,000 against the US dollar, Yit Fan said.

"This is based on the fact that foreign investors are in the
process of adjusting to changes in the business climate in
Indonesia," he said at a forum held by the Priority Banking
Division of Standard Chartered Bank's Jakarta branch.

The rupiah currently trades between 8,500 and 9,000 against
the dollar.

Yit Fan compared Indonesia's current situation to the
situation in Thailand when it was hit by economic and political
crises in 1997. Few companies left the country, and many
companies which stayed faced uncertainties but were able to deal
with the crises, he said.

Nevertheless, Southeast Asia will not return to precrisis
conditions when high growth rates propelled economies in the
region, he said.

"The crisis should have opened new opportunities to formulate
positive economic policies which will attract foreign investment
-- as an example, Thailand has seen increased investment since
the crisis occurred." (rid)