UI economic policy recommendation is too late: Analyst

UI economic policy recommendation is too late: Analyst

The Jakarta Post, Jakarta

One thing is certain from the ongoing presidential election
process; whomever emerges victorious will face a formidable task
in curing the country's economy.

Taking that into account, a group of 34 economists from the
University of Indonesia have offered to give the president a set
of guidelines for an economic recovery program for the next four
to eight years.

The recommendations, launched last week, centered mostly on
six economic pillars; an investment-boosting strategy, a poverty
alleviation, an economic development blueprint, economic growth
acceleration, clean governance, synergy in policy between central
and regional governments.

All were outlined in a book entitled Economic Issues and
Strategic Policy Recommendations.

But one analyst said that the policy recommendations had come
too late.

According to Aditiawan Chandra, the dean of UI's Economics
Department who leads the team, the proposal was made upon
learning that the economic platform set out by all five
presidential candidates was insufficient to deal with the huge
problems the next government would be facing.

"The vision and mission of these candidates seem to be
dedicated merely to campaigning. Their programs are short-term,
and not 'down to earth'.

"This recommendation looks also at the medium-term and long-
term -- from five to eight years -- not just the short-term,"
Aditiawan said.

Aditiawan added that, as shown by previous cabinets, the
government always seemed to start losing direction after the
first 100 days in office as a result of "short-term minded"
economic platforms.

While the economy may only grow by 5 percent to 6.3 percent in
the next five years, but the team said that if their agenda was
properly carried out, the next government could lay sound
foundation to overcome economic challenges.

Based on the team's calculations, if the economic agenda
stayed on track, the government could reduce the poverty level to
about 7 percent by the end of 2009 as compared to around 9.5
percent at present.

Macroeconomic stability would also be maintained with the
inflation rate at 3 percent to 5 percent and debt to gross
domestic products (GDP) ratio of below 40 percent.

Meanwhile, asked to comment on the recommendations, economist
of Bank Mandiri Martin Panggabean said he was not too impressed
with the plan, saying it as a bit too late.

"First of all, the timing is bad. If they really want this to
be adopted by the next government, why didn't they publish this
several months ago, which would have been made it easier for the
candidates to adopt it into their own economic platforms," Martin
said on Sunday.

"Now, the candidates already have their own economic teams,
and their economic platforms. The recommendation from UI suggests
that the economic platform from all the candidates were not
credible, which is not entirely true."

"I also regret that they had excluded the agenda on
agricultural sector, which should in fact be the main target if
we want to eradicate poverty and boost growth," Martin said.

Eyebox

Economic Pillars from UI

1. Prioritize investment growth, notably in real sector.
2. Poverty alleviation through the development of human resources
and extending economic access to poor families.
3. Blue print on economic development, including on the
industrialization, natural resources and energy, human resources,
employment both through the state budget and non-state budget
financing.
4. Acceleration in economic growth by strengthening the country's
industrial competitiveness and productivity.
5. Boosting clean governance, creating synergy with regions in
tax system and reducing the high cost economy
6. Creating synergy under the regional autonomy.