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series of policy adjustments and stronger economic fundamentals will help cushion the domestic economy in 2014 against tighter global liquidity and the contagious effects of the potential financial crisis engulfing emerging economies, officials say.

Indonesia has now made significant progress in controlling inflation and steering down the current account deficit ' the two major concerns among investors last year ' which means the country is now more prepared for a second round of capital flight this year, Finance Minister Chatib Basri has claimed.

'There's a difference between Indonesia and other emerging economies,' he said in Jakarta on Thursday, adding that only investors who did not know about Indonesia would put the archipelago in the same basket as troubled emerging nations, such as Argentina and Turkey.

Indonesia has undertaken several monetary and fiscal policy adjustments since the country was severely hit by capital outflows last year, after the US Federal Reserve hinted it would scale down its monetary stimulus.

Bank Indonesia (BI), for example, raised its benchmark interest rate by a cumulative 175 basis points last year and piled up its foreign exchange (forex) reserves to create room for the currency to weaken.

BI's moves were considered preemptive and exemplar, according to economists. Almost all central banks in emerging economies from Argentina, Turkey India to South Africa, hiked interest rates in January to lure inflows following Indonesia's move to raise the borrowing cost.

Another improvement in the economy has also been shown in the improving trade data. Trade figures for December, which will be announced this week, will likely post a surplus of around US$800 million, Chatib predicted.

It would push down the current account deficit to below 3 percent of gross domestic product (GDP) in the fourth quarter, compared to the historic high of 4.4 percent in the second quarter, he said.

'If both our macro- and micro-economic fundamentals are good, then it will be reflected by confidence among investors,' Financial Services Authority (OJK) chairman Muliaman D. Hadad said on Thursday.

The Jakarta Composite Index (JCI) was among the few stock markets that did not close in the red on Thursday, the day the US Federal Reserve announced another cut to its monetary stimulus to $65 billion from previously $75 billion.

The JCI rose slightly ' by 0.03 percent ' to close at 4,418.76, while indexes in the US, Japan, India declined by more than 1 percent, according to data compiled by the Indonesian Stock Exchange (IDX).

IDX president director Ito Warsito said Thursday that the performance of Indonesian equities over the past two days showed that any negative spill over from the situation in other emerging economies, such as Turkey and Argentina, on Indonesia would be, in fact, 'short-lived'.

'We're not immune to the negative effect of global sentiment, but investors apparently see Indonesia as having quite good [macroeconomic fundamentals],' he told reporters.

Meanwhile, the rupiah, Asia's worst performing currency last year after falling by more than 26 percent, has begun to stabilize this year. The currency depreciated by a mere 0.1 percent this month to hit 12,226 per dollar on Thursday, according to the Jakarta Interbank Spot Dollar Rate (JISDOR).