Indonesia has announced solutions to push up the biggest Southeast Asian economy following a sharp decline in foreign capital flow triggering its stock market to plummet and its rupiah to depreciate.
The move was put forward after emerging economies in the region including Indonesia were badly affected by the mass capital withdrawal of foreign investors due to concerns over the US’s possibility of reducing economic stimulus programmes.
In addition, the country faces domestic problems such as sluggish economic growth, rocketing inflation, and a large nonresident account deficit rate of 9.8 billion USD in the second quarter, the highest rate since the Asian financial crisis in the 1990s .
To deal with the deficit, the government will carry out such solutions as levying a higher tax on some luxury items, cut oil and gas prices, and promote exports by adjusting tax levels on industries.
Regarding foreign investment, the government will implement attraction policies such as hastening the approval process of projects in the fields of mineral exploitation and agriculture.
Indonesia’s stock market dipped nearly 9 percent for four days as of August 22, while the rupiah exchange rate is 11,000 rupiah/USD, the lowest rate since mid-2009.-VNA
The move was put forward after emerging economies in the region including Indonesia were badly affected by the mass capital withdrawal of foreign investors due to concerns over the US’s possibility of reducing economic stimulus programmes.
In addition, the country faces domestic problems such as sluggish economic growth, rocketing inflation, and a large nonresident account deficit rate of 9.8 billion USD in the second quarter, the highest rate since the Asian financial crisis in the 1990s .
To deal with the deficit, the government will carry out such solutions as levying a higher tax on some luxury items, cut oil and gas prices, and promote exports by adjusting tax levels on industries.
Regarding foreign investment, the government will implement attraction policies such as hastening the approval process of projects in the fields of mineral exploitation and agriculture.
Indonesia’s stock market dipped nearly 9 percent for four days as of August 22, while the rupiah exchange rate is 11,000 rupiah/USD, the lowest rate since mid-2009.-VNA
