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here are many economic problems confronting the government. While much political, legal and institutional polemic has focused on the economic slowdown, the government seems to find it difficult to reinvigorate the economy.

But if we think clearly, we should not immediately punish or judge the new government, given the size of the country and complex problems it is now facing.

But the perception seems to have worsened because of the overly high expectations at the outset of the Jokowi government The feeling of impatience and the sour notes coming from many parties make the economic situation seem even more pessimistic. But it was the great promises and high targets set at the beginning that caused extraordinary hope among the public.

Just look at Indonesia'€™s economic performance in the first half of this year. We have to admit that in the beginning, the government did well in taking a bold policy by abolishing the gasoline subsidy and setting the diesel oil subsidy at only Rp 1,000 (less than 10 US cents) per liter in January.

No one had expected Indonesia to be finally free from the 70-year fuel subsidy. The policy reaped positive sentiment in the market since the big burden of the budget was cut. The slashing of the fuel subsidy expanded the fiscal space as the energy subsidy dropped drastically by Rp 212 trillion to only Rp 138 trillion in the 2015 budget.

With the 2015 budget the government'€™s massive infrastructure development program became realistic. The people and businesses welcomed the government'€™s policies. The rating agency S&P also gave a positive assessment of the Indonesian economy by changing the outlook from stable to positive. This means we were one more step toward gaining investment grade status from S&P.

Unfortunately, as time went on, the optimism started to fade. The positive sentiment turned negative. Economic growth in the first half was really disappointing as it declined to 4.7 percent, from 5.1 percent in the same period last year.

Government spending, expected to offset the decline in private consumption and investment, has been much slower than planned. The realization of government spending in the first half was only 39 percent, slightly lower than last year at 40 percent. The growth of government spending in the second quarter was only 2.3 percent year-on-year, lower than the 2.7 percent in the first quarter.

Meanwhile, consumer spending, which contributed 50-55 percent of economic growth, was also weak, declining from 5.01 percent in Q1 to 4.97 in Q2. Purchasing power was declining, causing the whole economy to slow down.

The decline in purchasing power was caused by inconsistency and the inability of the government to check inflation. In the first two months of 2015, deflation was at 0.2 percent and 0.4 percent respectively but unfortunately in April-July, inflation seemed less controlled.

The food-supply policies were not carefully calculated. For example the currently high beef price should have declined after the Idul Fitri holiday. The government seems to be unable to calculate demand and the available supply.

Hence inflation management this year seemed worse than last year. The volatile food prices in the months of May-July doubled to 1.8 percent from last year'€™s 0.9 percent. The lack of coordination between ministries should also be blamed for the rises in administered prices of goods.

It is interesting to see that in April, for the first time in history, there were simultaneous increases in the administered prices of LPG, gasoline, diesel, intercity transportation and train fares. These five components contributed 0.33 percent to inflation out of total inflation of 0.36 percent in April 2015. In other words, the five components accounted for 92 percent of the total inflation that month.

The slowing economy, the poorly managed inflation and the rupiah depreciation to more than Rp14,000 per US dollar have combined to cause a cascading impact on the economy. To reverse the situation, in the next five months effective communication and rational policies are needed. The government'€™s credibility is at stake here.

The key is the government needs to make concrete policies that are easily understood by the people, business entities and investors. They need to show that infrastructure development will be pushed forward in the third quarter and the rest of the year, and inter-ministerial coordination should be improved to make coherent policies.

If the government puts in maximum effort, I think the people will still appreciate and support the government.

The slowing economic activities should be prevented from making the negative sentiment in the financial market even worse, especially when the global situation, particularly in China, is still weak. Quoting Lynn Northrop, the most important thing is '€œDo something '€” Feel a little better '€” Do more '€” Feel even better'€.
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The writer is chief economist at PT Bank Danamon Indonesia. This is a personal opinion.