Finance Minister Sri Mulyani Indrawati on Thursday described the Indonesian economic condition as fairly good amid the global economic slowdown.
The countrys economy is stable with growth predicted to reach 5 percent this year, when the global economy has shown no significant signs of recovery, the minister pointed out.
Sri Mulyani said Indonesia has big economic potentials making it one of favorite investment destinations in the world with advantages in licensing facility and demographic bonus, which could become an added value in the next several years.
“The economic reform marked with the series of economic policy packages, could be a factor encouraging participation of the private sector. There is also support from the growing and productive middle class and large population of potential young people,” she said.
In addition, the government is seeking to adopt a fiscal policy as a stimulus to improve economic performance though currently tax revenues still depend much on fund repatriation and asset declaration under the tax amnesty program, she said.
“The fiscal condition depends on the tax amnesty and we are also limited in capacity with the budget deficit. This is not by design but by default. However, we would continue to seek to increase revenues that we could continue to carry on with infrastructure development and eradication of poverty,” she said.
In anticipating crisis, Indonesia already has Law on Prevention, and Control of Crisis in Financial System (PPKSK) which stressed the importance of coordination between the finance ministry, Bank Indonesia, the Financial Service Authority (OJK) and Deposit Insurance Agency (LPS) in maintaining national economic stability, she said.
“The law has strengthened the capacity of the institutions that control of banking system and capital market could be more efficient. This is a form of good reform in facing possible crisis,” she said.
She said she hoped that all policies and regulations already issued could open an opportunity for the countrys economy to expand amid external pressures.
“Indonesia shows signs of big potentials. For that ambitious and sustainable reform should be launched that the economy becomes strong and sustainable resistant to the impact of global economic instability,” she said.