JAKARTA (TheInsiderStories) – Indonesia’s President Joko Widodo asked the global financial leaders to alert on the potential global financial crisis at the Annual Meeting Plenary at Nusa Dua, Bali. The International Monetary Fund (IMF) has warned a possible crisis in the global countries followed the trade tension, rising geopolitical risks and policy uncertainty in major economies.
The agency said, it is possible that emerging markets other than China may face outflows in the debt market for at least US$100 billion in the medium term.
“I want to emphasize at this time that we are entering the final session of the fight for global economic expansion, full of rivalry and competition. It could be a critical situation for the global economic crisis 10 years ago,” he said to the global financial leaders on Friday (12/10).
He added, “We depend on fiscal and monetary policy makers to safeguard the commitment of global cooperation. I really hope that you will contribute to encouraging world leaders to respond to the situation.”
He reminded the panel, that 10 years ago the world experienced a global financial crisis and urged the makers of world fiscal and monetary policy, to maintain the commitment of global cooperation. “I really hope you will contribute in encouraging world leaders to address this situation appropriately,” said him.
Furthermore, Widodo stated, the monetary and fiscal policies are needed to counteract the effects of trade war, technological disruption, and market uncertainty. He stated,” I hope that you will be able to absorb energy and draw inspiration from the beautiful nature of Bali and Indonesia, to produce clarity of heart and mind in improving global financial conditions for our common good.”
He also appreciated the policy makers to the extraordinary monetary and fiscal policy steps has been made by the regulator, which require a large (non-terror) political, to overcoming the 2008 global financial crisis. He said, the policy makers have saved the world from the global depression which at that time was also in sight.
He quoted Christine Lagarde’s (Managing director of IMF) statement right now to many problems that overshadow the world economy. For now, he continued, the United States enjoys rapid growth, but in many countries its growth is weak or unstable.
“Trade wars are increasingly rife, with technological innovation resulting in many industries being shaken. Countries that are (inaudible) are also experiencing huge market pressure. With various problems in the world economy, it is enough for us to say that winter is coming,” said Widodo by added next year, the world will see the last session of the Game of Thrones series.
He emphasized, at this time the world entering the last session of the fight for the expansion of the global economy full of rivalry and competition. It could be a critical situation for the global economic crisis 10 years ago, he said.
“We depend on all of you, the makers of world fiscal and monetary policy, to maintain the commitment of global cooperation. I really hope you will contribute in encouraging world leaders to address this situation appropriately,” the president said.
He believed, unilateral economic policies and trade wars do not increase the world’s wealth, it only makes nations and people poorer. President advised, the step up efforts to ensure that the growth is inclusive, and the normalization of policy settings by major economies are well communicated and implemented in a timely manner with minimal adverse spillovers.
Indonesia Take Several Steps
Furthermore, He explained, that Indonesia has taken several steps to respond to those issues, and greatly value the policy advice given by the Fund and the Bank and sharing lessons in the forum like IMF-WB Meeting, to find the optimum policy solution to those issues.
He admitted, Indonesia is not immune to the impact of monetary policy normalization in developed countries, trade tensions, and protectionism. But the country have been able to maintain stability and the soundness of the macroeconomic conditions.
The economic growth has been stable above 5 percent, supported by rising investment and improving exports. Inflation is also benign supported by improving supply side factors, while the financial sector remains stable despite recent global pressures. Furthermore, He said, Indonesia’s fiscal policy is prudent and supportive of growth.
“In today’s increasingly volatile world, the IMF provides valuable service to us by providing surveillance mechanisms to help us monitor, assess, evaluate and prepare necessary responses to global volatilities,” said by the president.
Overall, he stated, the prospect and outlook for Indonesia’s economy remains positive, confirming the country’s position as one of the most promising countries and one of the most attractive investment destinations in the world.
“To strengthen our growth and make it more sustainable, my administration is focusing on unlocking Indonesia’s growth potential by continuing our strong pace of infrastructure investment to improve connectivity and reduce logistical costs, with particular attention to infrastructure development outside Java island; enhancing productivity by increasing investment in human capital; and improving the business climate in general,” he added.