Working Committee for Economic Recovery Must Maintain Positive Economic Growth

Head of National Working Committee for Economic Recovery delivers a press statement at the Presidential Office, Jakarta, Wednesday (29/7).

President Joko “Jokowi” Widodo instructed National Working Committee for Economic Recovery to maintain positive economic growth in the third quarter which ends in September, Head of National Working Committee for Economic Recovery Budi Sadikin has said.

“The President also told us to maintain the availability of employment and maintain the people’s income to meet their daily needs,” Deputy Minister of State-owned Enterprises as the Head of National Working Committee for Economic Recovery said in a press statement at the Presidential Office, Jakarta, Wednesday (29/7).

For the record, the aims of Working Committee for Economic Recovery are to recover the short-term economy and to conduct economic transformation programs which are long-term and really fundamental for the state.

Based on a discussion between Coordinating Minister for Economic Affairs and Minister of State-owned Enterprises, the ongoing economic crisis caused by health crisis is different than those in 1998, 2008, and 2013 that were caused by financial crisis.

“For that reason, all economic programs must support health activities and programs,” Budi said.

Health programs are necessary to provide safety to the people so they can feel safe to work outside that eventually will stimulate the economic activities.

“However, crisis on health sector scares the public and prevent them to have activities outside their homes that significantly decreased the economic activities,” he said.

He went on to say that digital and virtual contacts do not have the same economic activity level as physical contacts. Thus, if people can change their behaviors through strict health protocols, safety can be established in the public space and people can feel safe to go outside, move the economy which will eventually return the government’s fiscal position to normal.

In establishing people’s safety, economic incentives and fiscal stimulus are necessary to provide income to those whose jobs very much affected by the pandemic.

The Head of Committee added that among many programs established during the pandemic, several program focusing on economic growth and employment will be prioritized in the third quarter of 2020.

“In the next two to four weeks we will focus on two programs for productive Micro, Small, and Medium-sized Enterprises (MSMEs). The first program will take a form of a grant not loan,” he said adding that each beneficiary will receive Rp2.4 million that is expected to be used to meet their basic needs and to restart business.

President Jokowi has instructed the Committee to start the program immediately and increase the number of beneficiaries to 10 or 12 million MSMEs.

“We will disburse the grant to one million MSMEs that we have identified, the number will increase gradually to 12 million beneficiaries,” Budi said.

The second program is credit with low interest rate that will be provided to the MSMEs, particularly home industries.

“We are planning to integrate credit program with the first program. First, the grant will be given to people who lost the jobs due to layoffs and those who just starting business,” he said.

On top of that, the Government will provide those just starting business with the credit program. Each beneficiary will receive Rp2 million that can be used for additional business capital.

“We hope we can follow the President’s instruction through grants and credit with low interest rate programs focusing on MSMEs,” he stated adding that the Committee will monitor the implementation of the programs and provide an update once a week on every Wednesday. (TGH/EN)

Translated by : Rany Anjany
Reviewed by: Yuyu Mulyani