The Jakarta Post
President Joko “Jokowi” Widodo has spoken up about the depreciation of the rupiah, which hit Rp 14,900 to the US dollar on Wednesday, saying that his economic ministers were dealing with the issue.
He underlined two things to stabilize the currency -- increasing investments to boost exports and resolving the current account deficit (CAD), which reached US$8 billion or 3 percent of the gross domestic product (GDP).
“If we can address [the two] we can address all [problems],” said Jokowi in Jakarta, adding that he gave the ministers a year to address the CAD.
He cited that the mandatory usage of 20 percent blended biodiesel ( B20 ) was one of the efforts to ease the CAD because it would be able to significantly reduce oil imports.
“[With B20’s mandatory usage], we will save an estimated US$5 billion to $6 billion. Meanwhile, we can use our own crude palm oil (CPO). It will increase the commodity price in the global market,” he said, referring to the government’s policy that had been in effect since Sept. 1.
Jokowi also called on the ministers to increase local content in government projects to reduce raw material imports. He added that it was expected to save between $2 billion to $3 billion in foreign exchange.
He said global uncertainty, sparked by the trade war between China and the United States, and the monitory policy normalization in the US have pressed currencies in emerging countries.
Jokowi added that the government was coordinating with other institutions to deal with the issue. (bbn)