ID :
44204
Wed, 02/04/2009 - 21:19
Auther :
Shortlink :
https://www.oananews.org//node/44204
The shortlink copeid
ECONIT PREDICTS 3.3 PCT ECONOMIC GROWTH
Jakarta, Feb 4 (ANTARA) - Economic research institute Econit Evisory Group has predicted that Indonesia's economic growth this year would reach 3.3 percent only instead of 5.0 percent as set by the government.
"Because the government is over confident, the Indonesian economy was forced to experience 'hard landing'," Econit founder Rizal Ramli said when exposing the results of his institution's assessment here on Wednesday.
According to Econit, as a result of the hard landing, the Indonesian economic growth in 2009 would decline from 6.0 percent in 2008 to 3.3 percent only in 2009.
"High economic and social costs as a result of the excessive self-confidence, weaknesses in its prediction and lack of anticipatory steps will result in the decline in the people's purchasing power and massive layoffs," he said.
Early in 2008, the Econit warned the government of a bubble in the capital market, commercial property credits and consumer credits.
Speculative capital inflow which was only US$14.8 billion ten years ago was let to double to US$24 billion until the middle of 2008.
"The government was proud of the speculative capital flow into Indonesia's economy while in fact it was opening itself to the world's economic turmoil and instability," he said.
He said that if the government wanted to open itself to the initial prediction, the Indonesian economy would only experience soft landing in 2009, namely its economy would drop to 5.0 percent only.
But because the government was over confident the economic and financial bubble was increasingly growing and when the economic crisis took place in the third quarter of 2008, Indonesia's economy experienced hard landing, he said.
He said that at the beginning of the crisis in 2008, Bank Indonesia followed the IMF advices to increase its interest rates while in fact countries all over the world lowered their interest rates.
"It turned out that the BI leaders did not learn a lesson from the crisis 10 years ago," he added.***
"Because the government is over confident, the Indonesian economy was forced to experience 'hard landing'," Econit founder Rizal Ramli said when exposing the results of his institution's assessment here on Wednesday.
According to Econit, as a result of the hard landing, the Indonesian economic growth in 2009 would decline from 6.0 percent in 2008 to 3.3 percent only in 2009.
"High economic and social costs as a result of the excessive self-confidence, weaknesses in its prediction and lack of anticipatory steps will result in the decline in the people's purchasing power and massive layoffs," he said.
Early in 2008, the Econit warned the government of a bubble in the capital market, commercial property credits and consumer credits.
Speculative capital inflow which was only US$14.8 billion ten years ago was let to double to US$24 billion until the middle of 2008.
"The government was proud of the speculative capital flow into Indonesia's economy while in fact it was opening itself to the world's economic turmoil and instability," he said.
He said that if the government wanted to open itself to the initial prediction, the Indonesian economy would only experience soft landing in 2009, namely its economy would drop to 5.0 percent only.
But because the government was over confident the economic and financial bubble was increasingly growing and when the economic crisis took place in the third quarter of 2008, Indonesia's economy experienced hard landing, he said.
He said that at the beginning of the crisis in 2008, Bank Indonesia followed the IMF advices to increase its interest rates while in fact countries all over the world lowered their interest rates.
"It turned out that the BI leaders did not learn a lesson from the crisis 10 years ago," he added.***
