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Government asks businesses to cooperate as global recession looms
Indonesia's government will need help from the private sector to help navigate negotiations for important free trade agreements, Foreign Minister Retno LP Marsudi told the Indonesian Chamber of Commerce and Industry (Kadin).
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Food for thought: Foreign Minister Retno LP Marsudi gives a press briefing on the achievements of her ministry’s 2018 program in Jakarta on Wednesday. (Courtesy of Foreign Ministry/-)
T
he government is encouraging businesses to contribute to the building of a resilient economy amid geopolitical challenges and a looming recession, asking them to work together to negotiate free trade agreements like the one with the European Union and a flagship initiative linking together a number of FTAs in the region.
The world is currently experiencing an economic slowdown, Foreign Minister Retno LP Marsudi told members of the Indonesian Chamber of Commerce and Industry (Kadin) at a coordination meeting in Jakarta on Tuesday, citing an International Monetary Fund forecast that places global economic growth at a meager 3.2 percent this year.
The IMF has also projected that around 90 percent of all countries including Indonesia will experience slower growth – in its 2019 World Economic Outlook published in October, the world monetary body slashed predictions of Indonesia’s rate of gross domestic product expansion to just 5 percent, down 0.2 percentage points from an earlier forecast in April.
Observers have singled out the protracted trade war between the United States and China as one of the biggest contributing factors of the global economic slowdown, and Retno said the government must work hard to benefit from the fallout, with businesses playing a significant supporting role.
According to Japanese investment bank Nomura, Indonesia was not considered a first-choice destination for companies looking to relocate their production facilities when the trade war first erupted, and President Joko “Jokowi” Widodo repeatedly expressed his concern on the matter.
“The world we face is not going to be easy. We hope that you can work together with the government to make Indonesia's resilient economy stronger, so that we will be able to survive,” Retno told business leaders.
The minister said she wasn’t going to allow Indonesia to remain a big market from which other countries benefit, and instead would use the country’s market size and large population as leverage in negotiating trade agreements, “so when we negotiate, we get win-win results”.
