Fiscal, Monetary Policies Must Go Hand in Hand, President Jokowi Says

President Jokowi delivers remarks at the 2022 Bank Indonesia Annual Meeting, at the Assembly Hall of Jakarta Convention Center, Jakarta, Wednesday (11/30). (Photo by: PR of Cabinet Secretariat/Jay)

President Joko “Jokowi” Widodo has called on the nation to remain optimistic and vigilant in facing global uncertainties next year.

“We all must be optimistic and stay alert for next year. We have to remain vigilant in formulating policies. Fiscal and monetary policies must synergize so all national economic policies will provide great benefits to the people and the country,” the President said at the 2022 Bank Indonesia Annual Meeting, at the Assembly Hall of Jakarta Convention Center, Jakarta, Wednesday (11/30).

On that occasion, President Jokowi also underscored three important things in dealing with global situations.

First, export. The President said that the improved value of Indonesia’s exports last year and now is estimated to experience a decline in the upcoming year due to economic situation in several Indonesia’s trading partner countries, such as China and the European Union.

“China is experiencing economic slowdown due to zero-COVID policy. The same goes for the European Union. The economic downturn is inevitable. We just have to wait when the recession hit. Also in the United States, the Fed Funds rate continues to rise so it puts the brakes on their economic growth. The US, China, and the EU are our largest export destinations. Therefore, stay alert,” he said.

Second, investment. The President surmised that the structural reform efforts made by the Indonesian Government has increased trust of investors, which must be followed by proper implementation on the ground.

“The idea of building a new way of working and a new mindset has created trust in us. However, be careful. We still need reformed policies, and need to properly implement them on the ground,” he said.

In 2023, the Government is targeting an investment value of Rp1,400 trillion, higher than that of investment value in 2021 worth Rp900 trillion and Rp1,200 trillion in 2022.

On that occasion, the President expressed belief that equitable development carried out throughout the country will attract investors to invest in Indonesia.

“I call on all ministries, governors, regents, mayors, to not disrupt capital inflows in terms of investment. Because it is one of the key drivers to our economic growth,” he added.

The President further said that equitable development also brought a significant impact on increasing new economic growth points as well as an investment outside Java Island, such as the Mandalika tourism area in West Nusa Tenggara, Labuan Bajo in East Nusa Tenggara, and Morowali in Central Sulawesi.

“I have been also informed that regions outside Java recorded higher investment value than that in Java Island. The figure usually stood at 70:30, 70 for Java and 30 for regions outside Java. Today, Java and regions outside Java are both contributing 53 percent of investment value. This is the success of building infrastructure that was followed by growing new economic growth points and investment towards regions outside Java,” he explained.

Third, the President highlighted the importance of maintaining household consumption which greatly impacts the national gross domestic product (GDP).

“Do pay attention to food supply and energy supply so that household consumption will constantly grow positively as targeted,” he said. (DND/UN) (RIF/MUR)