Mon, 14 Mar 2011

TEMPO Interactive, NUSA DUA:Bank Indonesia’s research and monetary policy director Perry Warjiyo, said the flow of foreign funds to developing countries was increasing due to improvements in the US economy. Developing countries in Asia will receive foreign funds as they have promising potential.

“Asia remains an attractive region this year,” Perry said in Nusa Dua, Bali, yesterday. Asia’s developing countries have obtained strong economic growth despite the global financial crisis.

According to Perry, the total flow of foreign funds going worldwide this year is estimated to reach US$ 800 billion. As much as US$ 400 billion will go to Asia’s developing countries. “Around US$ 13-15 billion is for Indonesia," he said, adding the figure was higher than last year.

Perry said that Asian countries were facing major challenges despite good economic fundamentals. Indonesia, for example, is facing increasing oil prices, but the country’s economic fundamentals are supported by its export characteristics. “Oil price increases will improve export performance,” he said.

The US’ improving economy will be another challenge to the flow of foreign funds, especially as recent data shows that the US has opened 1.5 million new job opportunities. “But we need not worry,” he said.

Based on studies carried out by the Institute for International Institution (IIF), the US’ economic recovery program is not progressing rapidly and is not absorbing the global liquidity excess.