2008 Economy

Jun 5th, 2007, in Business & Economy, by

The parliament's forecasts for economic conditions in 2008.

Commission XI of the parliament for Banking and Finance has agreed on a number of forecasts for the year 2008, these being:

  • 6.5-6.9% economic growth
  • 6.0-6.5% inflation
  • 7.0-8.0% interest rate on 3-month SBI's
  • 9,100-9,400 rupiah per dollar

Commission XI's target for economic growth is slightly less optimistic than the government's 6.6-7.0% prediction but a little more upbeat than Bank Indonesia's 6.2-6.8% range. Walman Siahaan of the Commission said: tempo

The government's target of 7% is too high and not in accordance with economic conditions.

Another Commission member, Olly Dondokombey, said the low-end prediction of 6.5% was realistic given the still strong rate of household spending. At the top end, 6.9%, growth would be capped by less than ideal infrastructure conditions and the government's slow disbursement of development funds (State Budget Implementation Forms (DIPA)) to the provinces. tempo

The Commission was of the opinion that investment would increase next year, although not to a great extent. Growth in exports would be hampered by slowing global demand.


8 Comments on “2008 Economy”

  1. avatar Masindi says:

    6.0-6.5% inflation is not going to happen in 2008.

  2. avatar Sylvester says:

    The true inflation in Indonesia may be even more than 10 %.

  3. avatar Quazi says:

    Inflation should be less than 6% considering it is 6% right now.

  4. avatar DoOs says:

    I concern more on the interest rate, such high rate is given that the government wants to do contractionary monetary. However why do you want to contract when the economy is performing under full capacity…

  5. avatar Syonan says:

    Before any forecasts can be announced and for Indonesia to move ahead it is advisable to revamp the Law (Undang-Undang) on investments. Indonesia will not progress with laws restricting development.

  6. avatar KSJ says:

    I got an idea, why don’t we change our currency by dropping the zeros? Rupiah is quite embarassing, too many zeros but little value. We can drop four zeros, making Rp 1 for Rp 10,000 or Rp 10 for Rp 100,000. The exchange rate would be Rp 0.91 instead of Rp 9,100 to US$1. I think the ‘decimalization’ would help the Indonesian economy.

  7. avatar Dragonwall says:

    Inflation should be less than 6% considering it is 6% right now

    How did this figure evolved from?

    The true inflation in Indonesia may be even more than 10 %.

    Yes much much more.

    making Rp 1 for Rp 10,000 or Rp 10 for Rp 100,000. The exchange rate would be Rp 0.91 instead of Rp 9,100 to US$1

    Interesting to know. Care to elaborate?

    If you are not owing money perhaps it is okay. But may I asked how much is Indonesia indebted? IMF, World Bank, Asia etc.

    I concern more on the interest rate, such high rate is given that the government wants to do contractionary monetary. However why do you want to contract when the economy is performing under full capacity”¦

    I Indonesia’s economy performing under full capacity? The real fact is it is under perform.

    The figures by those who agrees

    6.5-6.9% economic growth
    6.0-6.5% inflation
    7.0-8.0% interest rate on 3-month SBI’s
    9,100-9,400 rupiah per dollar

    The figures were in fact unacceptable at all. Like Sputjam said

    paint glowing pictures of certain assets before they overwhelm their target.

    to what I see the economic growth could be well below 2% where as inflation is in excess of 20%. Until today no one in Indonesia is capable of subduing it and bringing it back to normal.

    Indonesia cannot take other country into comparison by offering low interest rate by considering 7-8% or 10% as high. Considering the fluctuation and volatility of the Rups it doesn’t seem attractive at all to any investors.
    When inflation is what they considered @7% so what meaning will there be with interest of 7%?

    At the on going rate, the Rupiahs will continue to slide even with BI’s intervention.

    If the inflation rate is 2% then offering of 7% interest will be considered high.

    Academic is to informative whereas tactic is to practical.

    Remember! Indonesia is going to war. An economic war to save her economy.

    When you are poorly equipped how are you going to fight the war? You will just be a walk over for the Big Boys in the field.

    This is no joke. When you enter the field there is no turning back. The systems just become irretrieval. By which time more and more money will be plunge into it as though you are filling a bottomless hole. (Like Asia Economic Crisis).
    Scavengers are all over the world ever looking for an opportunity. The moment these money managers sees an opening they will creep in and yo yo you without you knowing it. By the time you reacted it is already too late.

    Since this is the case why not open it up and wait for them to come in.
    (Just a joke. If a pretty lady that is all covered up can only attracted momentarily attention. Whereas a not so pretty lady with mini skirt and V cuts will keep heads turning)

    It is all philosophy of life. All of us are humans. What you think of their moves, they may have already thought of it and think eve better with well cut plans in anticipation of your next move. It is like a battle field.

    Look: China has been the major exporter of literally anything to the US. Why? Because of the exchange rates. There are many dollar store sprouting up. How come?

    China’s product manufactured cost 1.50 RMB = 0.20 USD exported and sold at dollar store in the US at 1 USD = 8 RMB. They fought a winning battles against any major producer/manufacturing countries unsurpassed.

    Now some of the products were recalled for Health Hazard and this is the risk.
    Cost of shipping, recall, destroying it, replacements etc etc. What will the end cost be for China.

    So when you want it to be implemented, be prepared for the worst. It depends on what we are offering. How attractive it is and who will take the bait.

    Don’t just offer something when 1 % of the investors are interested. Make sure 99% of them are not only just interested but will be craving for more.

  8. avatar bin camel says:

    Money and power, those behind the glowing statement.

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