VOI - Voice of Indonesia | RRI - Radio Republik Indonesia

The National Development and Planning Ministry has said that economic transformation is one strategy that could help Indonesia to move closer to its goal of becoming a high-income country by 2045.

"Our target in 2045 is that we will get out of the middle-income trap to (become a) high-income country," head of planning at the ministry, Jadhie J. Ardajat, said at the ‘G20 3rd DWG Side Event: National Development Policymaking on Decarbonization,’ accessed from here on Monday.

On top of changing Indonesia's middle-income situation to a high-income one, economic transformation could also push annual economic growth to 6 percent in the 2022–2045 period, he added.

Ardajat listed various strategies that have been formulated to achieve the long-term economic development commitment, which includes creating competitive human resources by improving the health and education systems, character building, and increasing research and innovation as a first measure.

Second, improving the productivity of various economic sectors, including pursuing industrialization, boosting the productivity of micro, small, and medium enterprises, and focusing on the modernization of agriculture.

Third, pursuing the green economy concept that encompasses a low-carbon, circular, and blue economy, as well as energy transition.

Fourth, aiming for digital transformation, which includes digital infrastructure, optimization of digital technology, and enabling factors.

Fifth, integrating the domestic economy, which includes infrastructure connectivity, Superhub, Seahub, and Airhub, and integrating domestic supply chains.

Sixth, developing the new capital Nusantara as a means to create new economic sources and balance the regional economy.

"This is an important strategy to attain an advanced Indonesian economy by 2045," Ardajat said.

Besides pushing economic growth to 6 percent, economic transformation could also allow the eastern parts of Indonesia to contribute up to 25 percent to the national gross domestic product. (Antaranews)

Indonesia is striving to strengthen synergies in the global industrial, trade, and investment sectors through its G20 Presidency, Coordinating Minister for Economic Affairs, Airlangga Hartarto, has emphasized.

"Indonesia seeks to bring the G20 to be able to pave the way for the World Trade Organization to remain relevant in discussing the trade and economic impacts of the current global situation," he said in his virtual keynote speech at the ‘7th Global Conference on Business Management and Entrepreneurship' on Monday.

He said he believes that the efforts could assist in trade policy implementation as well as help maintain the supply chain, availability, and affordability of food.

"To face global challenges ahead, it is necessary to take a multilateral approach, which does not limit export and import trade activities, in accordance with the rules of the World Trade Organization," he added.

The trade, investment, and industry sectors have a big role as catalysts for realizing a resilient and competitive national economy, he said.

Hence, the Indonesian government has strengthened the performance of the three fundamental sectors, which is evident from the trade balance surplus of US$5.09 billion as of June 2022, with exports in the first half of the year reaching US$141 billion.

In addition, the realization of foreign and domestic investment in the first quarter of 2022 reached US$10.22 billion and US$9.33 billion, respectively.

Furthermore, regarding the industrial sector, the government is continuing its efforts to accelerate the downstreaming of commodities to increase the added value of raw materials, especially manufacturing products, which it has managed to maintain at an expansive level, the coordinating minister has stated.

The government is also committed to carrying out the energy transition considering the impact of industry on the environment as well as expediting the realization of clean energy by implementing more efficient investments and strengthening the use of sustainable industrial technology.

Hartarto said that the various efforts need to be supported by all parties—from the government, corporations, micro, small, and medium enterprises (MSMEs), to academics to produce innovations that help solve future challenges.

"Significant impacts cannot be achieved only with (the enforcement of) various policies, but it must also be supported by the transformation of the government, corporations, MSMEs, and the community to establish a smart and digitally savvy society," he added. (Antaranews)

Indonesia has called for an international concrete action to create a nuclear weapon-free world, Indonesian Ambassador to Japan and Federated States of Micronesia Heri Akhmadi said.

Akhmadi made the remarks in Tokyo on Sunday, coinciding with the commemoration of the 77th anniversary of the atomic bombing of Hiroshima on August 6, 1945, which killed tens of thousands of people in World War II.

He said the international community should refrain from taking an action which is not conducive to launch nuclear weapons.

"As one of the countries signing the Nuclear Non-Proliferation Treaty (NPT), Indonesia calls for the UN to become more intense in warning of the humanitarian and environmental consequences of non-compliance with the NPT," he said.

The NPT is an agreement among nuclear weapon states not to assist other countries in producing nuclear weapons.

The treaty confirms the commitment of nuclear weapon states and NPT-designated non-nuclear weapon states to prevent further proliferation, promote cooperation in the peaceful uses of nuclear technology and further the goal of achieving nuclear disarmament.

In other words, NPT serves as a foundation for international efforts to reduce the threats of nuclear weapons.

The commemoration of the 77th anniversary of atomic bombing was held at Hiroshima Peace Memorial Museum on Saturday.

The event was attended by Japanese Prime Minister Fumio Kishida, UN Secretary General António Guterres, Hiroshima Prefecture Governor Hidehiko Yuzaki, and Hiroshima Mayor Kazumi Matsui, as well as more than 100 foreign representatives in Japan. (Antaranews)

Economic challenges in the third and fourth quarters of 2022 will be quite large, Deputy Director of the Institute for Development of Economics and Finance (Indef) Eko Listiyanto said.

"Especially in  the third quarter when such momentum as religious holidays or other large events is relatively rare  this will certainly have implications on  economic performance," he said in a virtual press conference here on Sunday.

In the second quarter of 2022, Indonesia's economic growth was 5.44 percent. Indef lauded this achievement since  the government itself had projected the second-quarter growth to be slightly lower than the realization.

Listiyanto said that if economic growth in the third and fourth quarters of 2022 could be maintained at 5.44 percent,  then it would be very good.

However, he predicted the economic growth in the third and fourth quarters will likely be lower than in the second quarter because there is no holiday momentum such as Eid, The only momentum will be Christmas  in the fourth quarter of 2022.

"Moreover, the trend of inflation is also getting higher from month to month and it will also be a challenge since the inflation erodes purchasing power and makes consumption even more sluggish,” said Listiyanto.

Entering the third quarter of 2022, he hoped that the four main sectors that contribute the most to Gross Domestic Product (GDP), such as industry, mining, agriculture and trade, can be boosted again.

This is because the  contributions of  the four sectors to GDP were still low as they only grew by an average of 4 percent (compared to the previous year) or below the (year-on-year) economic growth of 5.44 percent in the second quarter of 2022.

"The previous growth was actually driven by supporting sectors. Meanwhile, the main sector has not recovered much. If we don't push the dominant sector, the economy will be vulnerable," said the Deputy Director of Indef.

Global uncertainty, especially due to geopolitical crises such as the war between Russia and Ukraine, will  add to the economic challenges in the third and fourth quarters of 2022.

"Moreover, there was a provocation from the United States (US), with the Speaker of the US House of Representatives (Nancy Pelosi) coming to Taiwan. This creates even higher uncertainty. The geopolitical crisis that previously only occurred in Europe is now shifting to Asia," he said.

From the financial side, Listiyanto said that the aggressiveness of the Fed's interest rate hike will continue until there are signs of easing inflationary pressures in the US. The US targets that this aggressiveness will be stopped if US inflation reaches 2 percent. However, US inflation is currently more than 9 percent.

Therefore, Listiyanto estimates that next year there will still be an increase in the Fed Funds Rate (FFR), which may have implications for volatility in the financial sector. (Antaranews)