BI predicts economic growth next year at below 6.7 pct
Governor
of Bank Indonesia (BI/the central bank) Darmin Nasution predicted
Indonesia`s economic growth in 2012 at below the government`s target of
6.7 percent it set in the 2011 draft state budget.
The BI
governor said that the slower economic growth which was predicted to be
lower than the target was due to the slowing down of world`s economic
performance as a result of the financial crisis in the United States and
Europe.
"The
slowing down of the world economy will have impact on the declining of
commodity prices that will eventually drive down export and economic
growth. With that conditions the economic growth in 2012 could be below
the target," Darmin said during a meeting with the budgetary body of the
House recently.
Darmin said that in the last two months
uncertain economic developments could be seen clearly as a result of the
debt and fiscal crisis in the United States.
"This conditions
have the risk of driving down the world economy, affect the world trade
and reduce the demand for Indonesia`s export commodities," he said.
However,
the assumed figure of 6.7 percent in the state budget could be achieved
if it is supported with a strong fiscal policy through high budget
absorption so that higher economic growth could be boosted, he said.
"The target could be achieved if the absorption of the state budget could be accelerated," the BI governor said.
In
the meantime, the local currency rupiah is also expected to continue to
appreciate more than the 2012 budget prediction, which was set at
Rp8,800 per US dollar.
He said that now the rupiah had up to
August continued to appreciate with a stable volatility, yet it would
appreciate further in 2012 as a result of the world economic turmoil.
"In
2012, the balance of payment will continue to be in surplus as a result
of capital inflow into the country`s the real and portfolio investment
sectors. This will boost limited appreciation of the rupiah, causing it
to be more appreciative than the assumed exchange rate in the budget,"
Darmin said.
source: Antara
