Rupiah's drop saddens many, benefits some

JAKARTA (JP): The rupiah's downfall has delighted some Jakartans, especially those who are paid or have deposits in U.S. dollars.

But the weakening of the rupiah (from Rp 2,300 in June to over Rp 8,150 against the U.S. dollar yesterday) has paralyzed the businesses and the future of many people here.

The Jakarta Post reporters talked with Jakartans about the issue and here are some excerpts.

Sudiono, an executive of a retail computer firm: "Our business is facing a nightmare at the moment with no end in sight. Before the crisis, we normally could sell at least five PC units per day in a showroom. Nowadays, it's a lucky day for us if one PC unit is sold in a week.

"This situation has forced us to temporarily "divorce" 60 of our 100 employees. Our salary has even been cut by 10 percent. What else could we do under the situation. The price of our computers, mostly imported from Taiwan and Singapore, has now almost doubled from the previous price list. The new Pentium 233, for example, is now priced at Rp 24 million, compared to Rp 12 million a few months ago. Now, could you tell me who wants to buy such a product at such an expensive price? Gosh, I don't know what to say anymore. I hope this nightmare will end soon."

Haryanto, a dentist: "As an ordinary citizen, I don't know what's going on with our currency. I haven't decided yet whether to hike my service fee because I'm afraid my customers would run away. I know exactly that they are facing the same problem. It seems that everything we've done in the past few years is meaningless. Look at my boy, who has just graduated as an architect. There's no job for him to go to since the property sector has been badly affected by the current turmoil. I planned to send him to study overseas but does he want to see his father financially ruined?"

Dharno, a senior resident of Tangerang: "What do we have to be worried about. It's all just about numbers, isn't it? My only wish is for my family to have enough rice and fried fish to eat. That's all. Nobody would like the 'old days' (the struggling years of Indonesians in the mid-1960s) to happen again."

Elvry M. Budhiyanti, marketing executive of Tona Roma's restaurant: "Like many other businesses, we of course have been affected, but it's not too serious. The rupiah's drop has mainly increased our food costs since we import about 98 percent of our food materials. In terms of sales earnings, there has been a slight drop over the past few months, but overall business is still quite good for us. No matter what, we base our sales on quality food."

Risman Hadrian, owner of a car accessories shop in West Jakarta: "If I had a choice, I'd stop my business and stay at home. But, who would pay my children's school fees and my two workers' salaries? Can you imagine that the price of almost every single item has been increased by our suppliers here? Even I myself was shocked at the new prices. So, how could I tell the price to my customers since I don't want to see people die in my shop from heart attacks. I don't know whose fault and sin this is that has pulled our country into such an awful economic situation."

Udin, a co-owner of a money changer in Central Jakarta: "This is a good time for us in the money changing business. Believe it or not, we've enjoyed at least a Rp 300 million net profit over the last three months alone. Before June, we were only making Rp 1 million in net profit a day, but nowadays we even once collected a Rp 40 million net profit in just eight hours. I think the big money changers are enjoying much bigger profits. Anyway, I hope these good times could be extended throughout the year. Ha... ha ..."

Arsil Moein, director of PT Ayumas Money Changer: "People who bought dollars when the exchange rate was still at Rp 2,500 are lucky if they kept them for savings. I think the government doesn't have the power to halt this because the crisis is also affecting other countries in the region."

(He refused to comment on the total value of his company's daily transactions and net profits).

"I think the big transactions are being made by foreign exchange banks, where the transactions can be up to millions of dollars."

Jane, an expatriate: "For me, the rupiah's fall is a very big concern because I get paid in local currency. I have a debt to repay in Australian dollars and the more the rupiah declines, the harder it is for me to make those repayments.

"All my family live in Australia, but I can't afford to buy a ticket to fly home and see them since airfares are calculated in American dollars. Even a one-way ticket would cost me more than Rp 4.5 million.

"I know many people think I'm laughing all the way to the bank but, apart from my own financial problems, it makes me really sad to see a country like Indonesia, which has so much potential, caught in such a dangerous downward spiral."

No one was able to predict whether the story of the rupiah will have a happy ending or not.

Mira Sumantri, a housewife in Kemang, South Jakarta: "I have two boys studying in the United States. Because of the monetary crisis, their tuition and other expenses have been multiplied by four. Of course it's hard for me and my husband. It's impossible for us to survive since the rupiah plunged to over Rp 6,000. This is crazy. If the condition doesn't get any better, I'll have to ask the boys to come home. I'll also have to work now to help my family's income. I can no longer sit at home and do nothing. At first, I thought this was a temporary crisis. But now, I don't know anymore."

Elman Sirait (not his real name), a private bank employee: "The crisis has forced me to postpone my marriage because I can't afford to buy a house for me and my bride-to-be due to the new interest rates, which have risen from 21 percent to 40 percent. Worse, my company doesn't seem to have any intention to raise my salary. So what can I do? I couldn't possibly get married and then live under a bridge. Luckily, my bride-to-be completely understands the situation. She is still young. So, it's okay if she has to wait just a little bit longer."

Ricky (not his real name), a main supplier of various items for a branch of the Armed Forces: "The drop of rupiah against U.S. dollar almost killed my business. I lost many opportunities to win projects, either they were delayed or scrapped from the department's budget. Fortunately, I still have a chance to do a few projects on maintenance or refurbishment. For the time being, we're doing business only if our client pays us in cash or in the short term. It is also better if the contract payments were arranged in U.S. dollars." (team)