The consumer price index rose 3.8 percent year-on-year in July, lower than the 4.37 percent recorded in the previous month, as prices of most commodities were relatively stable following a substantial rise during the fasting month and Idul Fitri holiday.

“The annual inflation of 3.8 percent in July was better than BI’s initial estimate” said Mirza in Jakarta on Thursday, while also expressing his hopes that the government can maintain the positive trend in the inflation rate until the end of 2017.

“If inflation remains low, consumer purchasing power can be maintained and industries will be competitive. If industries are competitive, we hope exports can thrive,” he said.

Mirza also said he hoped that manufacturing could increase its contribution to the Gross Domestic Product (GDP). The current contribution of manufacturing industry to the GDP is around 20 percent, he said.

“We want to see manufacturing industry contribute more than 20 percent of GDP,” he said, adding that the contribution of the manufacturing industry to the GDP reached 28 percent prior to the 1998-1999 financial crisis in the country.

Mirza added that he would also like to see an increase in loans to manufacturing industry in order to help the sector grow.

“Currently loans to manufacturing industry account for 17 percent of the total credit in Indonesia. The figure used to be 20 percent.” (mrc/bbn)

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