April 11, p6Indonesia does not know what to do with the Free Trade Agreements (FTA) that it has signed
em>April 11, p6
Indonesia does not know what to do with the Free Trade Agreements (FTA) that it has signed. The nation, through ASEAN, is partner to four FTAs with other ASEAN nations, China, Japan and Korea. FTAs with India, Australia and New Zealand are under negotiation. (By Anwar Nasution, Jakarta)
Your comments:
The currency depreciation and the trade deficit indicate that Indonesia's economy is overheating. Ironically, the weak currency is the only way to keep our exports competitive since there has not been much investment to increase added value on our products.
Indonesia could become the biggest loser in FTA implementation and the currency wars if this keeps going, because it relies too much on imports. A weakening currency will increase production costs.
The currency itself is still the most worthless currency in the world and has not appreciated in midst of flood of quantitative easing done in the US and Japan.
Michel de Wilde
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