VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

VOINews, Jakarta - The Association of Southeast Asian Nations (ASEAN) and Japan have agreed to form a Strategic Comprehensive Partnership through tangible, mutually beneficial concrete cooperation. Japan is ASEAN's most active partner and the leading supporter of the ASEAN Outlook on the Indo-Pacific (AOIP) implementation.

Support for these two factors can contribute to and realize concrete cooperation that directly benefits the people.

"ASEAN and Japan have agreed to establish a Comprehensive Strategic Partnership beyond ceremonial formalities and small talks," said President Joko “Jokowi” Widodo in his opening remarks at the 26th ASEAN-Japan Summit at the Jakarta Convention Center (JCC), Jakarta, on Wednesday, 6 September 2023.

Strengthening cooperation, continued President Jokowi, has the potential to meet the infrastructure investment needs of ASEAN with an annual cost of US$184 billion. The cooperation that can be bolstered are the ASEAN Infrastructure Fund and the ASEAN Catalytic Green Finance Facility.

Both play a crucial role in supporting green infrastructure and connectivity. President Jokowi believes that strengthening cooperation between ASEAN and Japan will become even more massive in scale since Japan is geographically close to the ASEAN region.

Both ASEAN and Japan, said President Jokowi, have a shared responsibility to contribute to keeping ASEAN a peaceful, stable, and prosperous region.

"This is our home where we grow dan dwell," said the President.

President Jokowi chairs the entire series of meetings on the second day of the 43rd ASEAN Summit which is conducted at the Jakarta Convention Center (JCC).

President Jokowi also chaired the 26th ASEAN-China Summit which was attended by ASEAN Leaders and Prime Minister of China Li Qiang and the 24th ASEAN-Republic of Korea (ROK) Summit which was attended by the President of the Republic of Korea Yoon Suk Yeol. President Jokowi together with ASEAN Leaders is scheduled to attend the 26th ASEAN Plus Three Summit.

The Prime Minister of China, the President of the Republic of Korea, and the Prime Minister of Japan will attend the Summit that will be held in Cendrawasih Room 3, Jakarta Convention Center (JCC), Jakarta.

Furthermore, the ASEAN-Canada Summit will be attended by Leaders of ASEAN countries and the Prime Minister of Canada Justin Trudeau.

In the evening, President Jokowi and Mrs. Iriana Joko Widodo together with Heads of State/Government and their spouses will attend the Gala Dinner of the 43rd ASEAN Summit. (VOI)

VOINews, Jakarta - The ASEAN digital finance initiative has made a significant contribution to the acceleration of financial inclusivity in the region. Over the past few years, State-Owned Enterprises (SOEs) have played a crucial role in guiding the transformation amid the booming development of digital finance.

This was stated by the Deputy Minister of SOEs, Rosan Roeslani, in a statement received by the Communications and Media Team of the 43rd ASEAN Summit, on Wednesday, 6 September 2023 in Jakarta. ASEAN, as home for 680 million people and 70 million SMEs, is still faced with significant challenges in financial inclusivity.

The level of public awareness of transactions and the use of banking services is still low, with up to 70% of the unbanked population. Moreover, around 39 million out of 70 million SMEs also face a substantial funding gap of US$300 billion annually. Vice Minister of SOEs, Rosan Roeslani, explained that in the midst of this situation, the emergence of digital financial services paves the way to bridge the financial gap, especially for those of the unbanked population, who do not use banking services, and also for SMEs that may have been previously considered unbankable. Digital financial services are crucial in promoting financial inclusivity and serve as the foundation for sustainable and inclusive economic growth in the ASEAN region.

"We’ve seen examples in ASEAN countries that the digital financial growth and revolution have boosted the country's economy and economic inclusivity. Similar developments have also occurred in Indonesia in recent years, where Indonesia has been at the forefront of the digital financial revolution, demonstrating remarkable growth and resilience," said Rosan.

Rosan revealed that between 2011 and 2022, the number of financial technology users in Indonesia increased sixfold from 51 users to 334 active users.

Meanwhile, 33% of the population chose e-wallets as their default payment method in 2021. This has put Indonesia in the same position as some developed countries in Asia.

"Indonesia's transition to digital economy is apparent with the surge in non-cash payments from US$813 million to US$26.2 billion from 2017 to 2022. The transition to a rapidly growing digital transaction ecosystem is reflected in the value of digital payment transactions, which rose from US$206 billion in 2019 to US$266 billion in 2022," explained Rosan.

He continued, that the growth in digital payment transactions is expected to continue to rise, reaching over US$421 billion by 2025.

With its wide reach, SOEs play a crucial role in promoting financial inclusion through digital finance, especially in less accessible cities. Over the past few years, SOEs have acted as catalysts, initiating visionary initiatives and forming strategic collaborations to transform Indonesia's digital financial services in various aspects. From the ASEAN perspective, in recent years, the ASEAN digital financial sector has also undergone a transformation, mainly aimed at strengthening financial inclusion for consumers and SMEs.

Growth in this field is robust, with an increase in digital payment volume. Meanwhile, the landscape of digital finance is also catching up and is expected to grow significantly by 2030. In response to this phenomenon, SOE banks are now focusing on three transformations, including digital lending, digital payments (e-wallets), and digital banking.

In digital lending transformation, BRI, Bank Mandiri, and Bank BNI have launched digital lending platforms that allow individuals with no lending history to access financial services digitally. This initiative has had a significant impact on financial inclusion. The BRI digital lending, for example, grew by 146% in one year from 2021 to 2022, with a loan value of US$125 million to millions of lenders in the first three quarters of 2022.

"Furthermore, for digital payments (e-wallets), several SOEs have expanded payment services through e-money platforms. Lastly, for digital banking, Bank Mandiri, BRI, BNI, and BTN have also developed digital banking solutions, including BNI's mobile banking, which grew by 59.6% year on year to 7.8 million users in 2020," explained Rosan.

Financial inclusivity is not only merely the goal of the economic sector, it is also for the best interest of society.

"We sincerely hope that the discussions in this forum will yield solutions to the financial inclusivity challenges we face in the region, in order to maintain stability and prosperity in the ASEAN region," concluded Rosan.

Australia will host leaders from Southeast Asia's ASEAN bloc in Melbourne next March for a special summit to commemorate 50 years of relations, Prime Minister Anthony Albanese said on Wednesday as he announced a new investment strategy for the region.

Albanese told reporters in Jakarta he had written to all the bloc's leaders inviting them to the "significant event", set to run from 4 March to 6 March. The summit would also be a chance for diplomatic bilateral meetings and business forums, he added.

Albanese has travelled to Jakarta for the Association of Southeast Asian Nations (ASEAN) summit at a time when Australia is strengthening relations across Asia in a bid to build economic and diplomatic alternatives to China. ASEAN was vital to Australia's future, Albanese said in a speech to the summit.

"This is where Australia's economic destiny lies, and this is where our shared prosperity can be built," he said.

"This is where, working together, the peace, stability and security of this region – and the Indo-Pacific – can be assured."

The ASEAN summit gathers with U.S. Vice President Kamala Harris, Chinese Premier Li Qiang, and leaders of various partner countries including Japan, South Korea and India at a time when the bloc's members are wary of being dragged into great power disputes.

Albanese also used his speech to unveil a new economic strategy for the region, and announced an initial A$95.4 million ($60.89 million) package to fund investment deal teams, internships for young professionals and support for Australian companies looking to enter the region.

The strategy comes with 75 recommendations including using government agencies to help underwrite infrastructure investment in the region. Albanese said his government would work through the recommendations in an "orderly fashion". (Reuters)

South Korea should maintain current, restrictive monetary and fiscal policies as it needs to take steps to return to sustainable finances and address inflation, the International Monetary Fund (IMF) said on Wednesday.

"The monetary policy rate should stay above neutral for the time being to address inflation, with the interest rate path remaining data dependent," the IMF said in a statement concluding its two-week long visit to the country.

Harald Finger, Korea Mission Chief of the IMF, said, "Moderate consolidation (of the 2024 government budget) will help limit public debt and, at the same time, will support monetary policy in efforts to contain inflation."

Instead of undermining economic growth, the prudent fiscal policy is judged to be instrumental in keeping South Korea's economic fundamentals strong in the medium term, Finger said at a press conference.

Last month, the South Korean government proposed to raise budget spending for 2024 by the lowest rate in two decades, prioritising fiscal discipline amid weakening tax revenue due to slower economic growth.

The Bank of Korea held interest rates steady for a fifth straight meeting in August, in a balance between softer inflation and heightening risks to growth.

"We do see a moderate increase in downside risk for Korea's growth, especially in 2024, with China's renewed slowdown," Finger said, also pointing out China's policy measures to mitigate economic slowdown and other positive factors such as the resumption of Chinese group tourism.

In July, the IMF forecast Asia's fourth-largest economy to grow 1.4% in 2023, a three-year low after expansion of 2.6% in 2022 and 4.3% in 2021. It expects the economy to grow 2.4% next year.

Finger told reporters the IMF decided not to evaluate South Korea's foreign exchange reserve adequacy based on its Assessing Reserve Adequacy (ARA) metrics from July.

The measure is mostly for emerging economies, and given its economic characteristics, it is more appropriate to assess South Korea's on a scenario basis, Finger said. (Reuters)