Remarks of President of the Republic of Indonesia at the 2020 Bank Indonesia Annual Meeting (virtually) Thursday, 3 December 2020 at the Merdeka Palace, Jakarta

Bismillahirrahmanirrahim.

Assalamu’alaikum warahmatullahi wabarakatuh,

May peace be upon us all,

Om Swastiastu,

Namo Buddhaya,

Greetings of Virtue.

Distinguished Heads of State Institutions;

Distinguished Ministers of Indonesia Onward Cabinet;

Distinguished Governor and Board of Governors of Bank Indonesia;

Honorable representatives of friendly countries in attendance;

Distinguished Governors;

Ladies and Gentlemen.

For the past nine months, we have worked hard to overcome the impact of the pandemic, tackle health and economic issues simultaneously, maintain the “brake and gas” balance, curb the COVID-19 transmission, help patients to recover quickly, help people stay productive and survive amid the crisis.

The hard work is starting to pay off. We have seen positive signals. Alhamdulillah, based on the reports I received today, COVID-19 active cases in Indonesia are lower than that of the global average. Indonesia recorded 12.72 percent of active cases, while the global average stood at 28.04 percent. The recovery rate is also improving, reaching 84.02 percent, better than that of the global average recovery rate at 69.56 percent.

The positive signal for the economic sector is also getting clearer. Our hard work is starting to pay off. In the second quarter, our economy contracted to minus 5.32 percent. In the third quarter, our economy contracted to minus 3.49 percent. This means, the country’s economy has passed through its lowest point, which was the turning point towards improvements. The positive trend is improving. With this momentum, I am sure we will move towards a positive direction in the fourth quarter and beyond.

In line with this, the manufacturing industry which is the largest contributor to the GDP (Gross Domestic Product), also showed improvement in October 2020. The improvement was sustained by an increase in imports of raw materials and capital goods in October. The trade balance, which saw a surplus of US$8 billion in the third quarter of 2020, also supports the resilience of the external sector.

In terms of the capital market and finance, the performance of the IHSG (Composite Stock Price Index) and the rupiah exchange rate showed an increase up to the level of 5,522, while the rupiah exchange rate against the US dollar was Rp14,050, on 17 November 2020. The improvement in the IHSG performance was driven by an increase in the sectoral stock index. The basic industry sector saw the largest stock index recovery since the sharp drop on 24 March 2020.

Ladies and Gentlemen,

We must maintain this positive-growth momentum. We have to be careful, stay alert. We still have to continue implementing health protocols. Let us be vigilant so that the second wave will not occur, which will be very detrimental to the efforts and sacrifices we have made. We must focus on moving forward in an effort to escape the pandemic. Do prepare vaccines and vaccination program carefully so that we can rise and recover from the pandemic.

We must move swiftly since we still have several measures to take. We will be faced with a large number of unemployed people as a result of massive layoffs due to the pandemic. We are facing a large workforce that needs job opportunities. Therefore, the Government must carry out structural reforms and cut red tape.

We are all aware that the country ranked first in the Global Complexity Index, the world’s most complex market. We must put an end to it. That became the spirit behind the issuance of the Job Creation Law, creating a more conducive and competitive business climate so that micro, small, and medium enterprises can be more developed, and labor-intensive industries grow rapidly. Do simplify business license, MSME permits are made simpler through business registration, and other conveniences.

Ladies and Gentlemen,

I hope central bank Bank Indonesia will play a more significant role in the fundamental reforms that we are currently executing, provide greater contributions to stimulate the real sector, push for more job opportunities, and support business players, particularly the MSMEs sector so they can return to be productive.

In a crisis situation as it is today, we must be able to move swiftly and precisely. Do eliminate those sectoral egos, institutional egocentrism, and do not shelter behind the tall walls of respective authorities. We must share the burden, share responsibility for the sake of the nation and state affairs so that our country will be able to transform into a new economic power at the regional and global levels.

That concludes my remarks.

I thank you.

Wassalamualaikum warahmatullahi wabarakatuh.

Translated by Syarifah Aisyah
Reviewed by Muhardi