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Jakarta Post

Sense of crisis

  • Editorial board

    Jakarta

Jakarta   /   Fri, August 7 2020   /  01:00 am
President Joko Widodo (second right) with Vice President Ma'ruf Amin (right) conversing with Minister of Finance Sri Mulyani (second left) and Minister of Cooperatives and SMEs Teten Masduki (left) before chairing a limited cabinet meeting on the downstreaming of the superior products industry in President's Office, Jakarta, Thursday (02/06/2020). President Joko Widodo said the national industry had been able to make products with superior technology and requested to continue to be developed with adequate research funding from SOEs and the private sector. (Antara/Hafidz Mubarak A)

It comes as no surprise that Indonesia’s economy contracted in the second quarter of this year, although at minus 5.32 percent the rate is deeper than the government and economists had estimated and the weakest since the aftermath of the 1998 financial crisis. Countries around the world from the United States and European countries to China and others in Asia are also seeing negative growth in gross domestic product (GDP). The International Monetary Fund (IMF) expects the global economy to contract 4.9 percent this year. It is very disappointing, however, to see little contribution from government spending to at least soften the hard blow from the pandemic to the nation’s economy. Government spending may be the only part of the economy we can expect to contribute during this tough time. The government has increased state spending by 7.9 percent to Rp 2.74 quadrillion...