TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Keep calm in political year, Jokowi says
Dismissing concern about economic instability as elections will be held in several regions of the country next year, President Joko “Jokowi” Widodo has told businesspeople to stay calm and adopt a “business-as-usual” attitude
Change Size
D
ismissing concern about economic instability as elections will be held in several regions of the country next year, President Joko “Jokowi” Widodo has told businesspeople to stay calm and adopt a “business-as-usual” attitude.
Addressing an economic forum on Tuesday, Jokowi said Indonesia had faced numerous elections in its history with relatively little impact on the national economy.
“Many have said that businesspeople will take a wait-and-see position, but until when? In 2014, we had a presidential election, in 2015, we had 151 regional elections, and in 2018, we will have 171 regional elections, while in 2019, we will face another presidential election. Do you want to wait and see again?” the president asked at the event hosted by the Institute for Development of Economics and Finance (INDEF) and Metro TV.
Given the relatively small impact of previous elections on the domestic economy, Jokowi said he hoped politics would stay politics and economics would stay economics.
Coordinating Economic Minister Darmin Nasution echoed the President’s message, saying that, contrary to widely held assumptions, elections historically had had a positive impact on the economy.
He estimated that regional elections and major international events Indonesia will host in 2018, particularly the Asian Games, would contribute 0.2 to 0.3 percent to domestic economic growth.
“Taking into account the elections as well as the Asian Games, our economy could grow by 5.4 to 5.5 percent next year, if we take the optimistic scenario.”
Darmin was also positive that investment and exports could contribute to economic expansion next year, while household spending was not likely to change dramatically.
“Consumption will not change drastically, but investment can change quickly, as can exports. If investment and exports become pillars to support an economic expansion amid unchanged household [spending], we will have robust growth [in 2018],” he said.
Investment, one of the key drivers of growth, was up 7.11 percent year-on-year (yoy) in the third quarter of this year, according to data from the Central Statistics Agency (BPS).
Exports surged to US$138.462 billion in the January-October period of this year, up 17.49 percent from last year.
Indonesian Chamber of Commerce (KADIN) chairman Rosan P. Roeslani, meanwhile, said businesspeople were expecting next year to be “business as usual.”
“We can see that elections are not a new thing. When I asked businesspeople, they too said it was ‘business as usual.’ So there are no worries,” he said.
He also said that businesses may look to expand in the coming years on the back of improved commodity prices, Indonesia’s investment grade rating and stronger consumer spending.
“The commodity prices are also good. This will help our economy, as our exports are comprised mainly of commodities,” Rosan said.
INDEF senior economist Didik Rachbini advised political parties against rough campaign methods, arguing that an uncontrolled political situation could lead to economic decline.
“Because politics is like a roller coaster, there are ups and downs. If politics change drastically, the economy will fall as well,” he said.
Didiek cited the Jakarta gubernatorial election, which witnessed heated tensions among groups with different positions, as an example of an election that did slightly affect the economy.
“The Jakarta gubernatorial election was a bad experience and should not be repeated,” he said, adding that the economy had got back into shape as the situation improved.
