Pushing for Economic Recovery

KOMPAS/ADITYA PUTRA PERDANA

Central Java Governor Ganjar Pranowo removed containers carrying fishery commodities for export to a number of countries, in Semarang City, Central Java, Wednesday (4/14/2021). In the period 12-17 April 2021, 584.45 tons of fishery commodities were sent from Central Java, including to China, Vietnam, Australia and the United State.

The global economy continues to show signs of revival, even though it is overshadowed by uncertainty relating to the world situation which is now returning to a critical phase of Covid-19.

The urge for Indonesia to take advantage of the global economic recovery momentum to boost exports is highly relevant, especially with the strong recovery in Indonesia\'s main export destination countries, particularly in Asia and the United States. The recovery of these countries also increased their demand for export products from Indonesia.

According to data from Statistics Indonesia (BPS), exports in the first quarter of 2021 increased 17.11 percent compared to the same period in 2019, reaching a record high in the last 9-10 years, with the trade surplus more than doubling. The expansion of the national industry -- reflected in the increase in exports of the processing industry and imports of raw/auxiliary materials and capital goods -- in the first quarter of 2021, is another indicator of the recovery of the national economy, although the increase in export value was partly caused by the increase in commodity prices such as palm oil and coal.

Also read: Economic Recovery Priorities

The increase in exports, followed by an increase in investment, is expected to boost domestic economic recovery and create job opportunities. The importance of downstreaming industry to strengthen the manufacturing chain and also Indonesia\'s position in the global value chain, is reminded again, so that we can get away from too much dependence on commodity exports.

Previously, a number of institutions, including the International Monetary Fund (IMF), had briefly revised down Indonesia\'s growth projections for 2021. The high number of new Covid-19 cases, which forced the government to impose various social restriction policies, made the prospect of economic recovery and the outcome of various extensive counter cyclical macro policies to reduce the impact of a pandemic, not as expected.

Also read: Trading Strategy Is Needed

KOMPAS/ANGGER PUTRANTO

Angkasa Pura Kargo officers at Banyuwangi Airport arranged a container containing 1 ton of coral which will be exported to Hong Kong from Banyuwangi Airport, Thursday (18/3/2021). Banyuwangi Airport is now an export gateway because it is able to send direct cargo export commodities to destination countries.

Due to these considerations, the national economic recovery (PEN) policies through the expansion of the scope of various social protection programs and incentives for business actors is continued, through the allocation of Rp 688 trillion in PEN funds in 2021. Business actors also have a lot of hope for the implementation of the Job Creation Law, which is expected to improve the business and investment climate.

Faced with the twin economic and health crises, we really have no other choice but to exert all our efforts to recover as quickly as possible. Apart from global economic recovery, domestic economic recovery will also be largely determined by the sustainability and effectiveness of the economic recovery policies taken by the government and also our ability to control Covid-19.

Also read: Don\'t Make the Farmers Depressed

Obstacles in Covid-19 vaccination, especially related to the availability of vaccine following an embargo by India, and the ability of medical personnel in the field, remain a challenge.

We all have to contribute to pushing Indonesia to recover as soon as possible. The longer it takes for us to recover, the greater the costs this nation will have to bear. So far, a number of indicators such as the export-import figure, the Purchasing Managers Index and trends in bad credit figures, show a positive picture of economic recovery. However, we also must not be over-confident. Here, it is important to take advantage of the existing momentum to solve short-term problems, while at the same time laying a long-term foundation.

This article was translated by Kurniawan Siswoko.