Illustrative image (Source: Nikkei Asian Review)

Jakarta (VNA)
- More than 40 companies have lined up to raise about 30 trillion Rp (2.2 billion USD) in fresh capital through initial public offerings (IPO) and bond and rights issuances through the Indonesia Stock Exchange (IDX) within the next few months, according to the Financial Services Authority (OJK).

This is an indicator of a golden moment in the economy as the whole election process and its legal procedures have been completed with the Constitutional Court’s confirmation of incumbent Joko Widodo as the president-elect, who will start his second term in October.

The financial markets are usually the first to react to any new developments in political and macroeconomic stability and policy predictability.

The top priority programmes of the Widodo administration are familiar to the business community: physical infrastructure, institutional capacity building to develop a clean, efficient and competent system of governance and business licensing, as well as a better-targeted vocational training system.

Widodo’s campaign promises suggest that these working programmes and inclusive growth enhancement will even be stepped up.

The World Bank’s latest economic quarterly report revises down Indonesia’s growth to 5.1 percent forecast for this year because of negative external factors.

Given the subdued market conditions for export, private and government consumption and investment will continue to be the main drivers of growth.

This requires, in addition to massive reforms, prudent fiscal and monetary management to maintain a fairly stable exchange rate and low inflation to enable the Indonesian central bank to ease its benchmark policy rate and introduce additional accommodative measures to stimulate domestic demand.-VNA