The Rector of Universitas Indonesia, Prof. Ari Kuncoro, S.E., M.A., Ph.D., gave an overview of Indonesia’s economic conditions during Covid-19. “Indonesia relies heavily on portfolio capital. As soon as Covid-19 came, foreign capital immediately ‘ran away’. As a result, the rupiah is approaching 16,700. If in a normal situation, it is called deficit financing, inflation would have risen, but this is an abnormal situation because there is a pandemic. Therefore, efforts were made so that the rupiah strengthened to around Rp14,000. This means that policies that were optimal in the past are not necessarily optimal in the present and policies that are optimal in the present are not necessarily optimal in the future,” said Ari Kuncoro, a speaker at the Indonesia Economic Outlook 2022 held by the Indonesian Young Entrepreneurs Association and the Association of Indonesian Regency Governments, on Tuesday, (25/1/2022).
This activity aims to strengthen collaboration, support Indonesia’s Presidency of the G20, and encourage innovation to accelerate economic recovery in the country. In the midst of the ongoing health crisis, the 2022 G20 Presidency could be the right momentum for the Indonesian government to reset the long-term development agenda while discussing among the country leaders on a stronger and more equitable global recovery.
The optimism of economic recovery was discussed in a discussion entitled “Indonesia’s Macroeconomic and Financial Sector Outlook 2022″ delivered by Ari Kuncoro as UI Rector and senior economist, Anggawira as Chairman of Finance and Banking of BPP Indonesian Young Entrepreneurs Association, and Josua Pardede as Chief Economist of Permata Bank.
Ari Kuncoro added that in economic recovery amid the pandemic, a signal is needed. Signals are important because businesses have grown. When other countries implement lockdowns, Indonesia chooses a scheme to impose restrictions on community activities so that people can make adjustments without closing logistics channels. As a result, there is economic growth and the rupiah is stable. Therefore, the key to rupiah stability is not only in foreign exchange management, but also how policies are designed.
On that occasion, the UI Rector also appreciated the steps taken by the government in making economic policies in this pandemic situation. “One of the characteristics of Indonesia’s economic policy is thinking beyond the curve. This is what I gave an A to. The government is not in a hurry to tighten up, but prefers a work-from-home scheme. Operations from non-essential areas were reduced and an inclusive healthcare industry was introduced,” Ari Kuncoro said.
According to Ari Kuncoro, there must be a good business climate to restore Indonesia’s economy. The Job Creation Law is prepared so that investment is thinking beyond the curve. In addition, policy-making must pay attention to policy innovation. While the economy could potentially grow by more than 5%, the regulatory system must make it easier to think outside the box. In addition, the G20 can be a bargaining position for Indonesia. Indonesia can supply labor and make some areas as factory locations for countries in conflict. This is Indonesia’s opportunity to introduce Indonesia to the international supply chain.
Writer: Sapuroh | Editor: Mariana Sumanti
