Tue, 28 Dec 2010

Jakarta (ANTARA News) - The sound investment and export climates have contributed substantially to improving Indonesia`s economic conditions in 2010 as a whole, according to Coordinating Minister for the Economy Hatta Rajasa.

"As a whole, we have done very well in the investment and export sectors. They are above all the growth targets. Our trade balance has also been quite positive," Rajasa told the media at his office here on Monday.

Minister Rajasa added that the manufacturing sector grew over 4.0 percent in 2010 and was expected to grow well beyond that figure in 2011 as this sector would be significant in providing employment.

For 2011 the government would develop downstream industries by giving certain incentives to investors which will do business in the downstream industries, notably those engaging in superior commodities.

"We`ll talk about incentives and disincentives on matters related to our superior commodities, either mineral or agricultural," he said.

Despite the excellent overall performance , Rajasa said, there were also several aspects about which the government was still worried in 2011 such as trade balance deficits especially in the oil and gas sectors with soaring imports as consumption had surged.

From the supply aspect, he said, the government had actually tried to increase production by constructing new refineries that were balanced with the introduction of saving measures.

"The first step was managing supply where we have increased production and constructed refineries. Second, we have controlled demand by (introducing) saving steps," he said.

For the future, the government will be more cautious on inflation as it affected the agricultural and mining sectors, the minister said.

"Inflation will pose a certain challenge because this extreme climate will affect the systems of distribution and production, either on the agricultural or mining sectors, two sectors which hard hit by inflation," said Rajasa, adding that these two sectors had significantly contributed to the overall economic growth.