Stagnant Investment Amid Political Year Is Normal, Expert Says
TEMPO.CO, Jakarta - An economic observer Faisal Basri on Wednesday predicted that Indonesia will see fewer investments ahead of the 2024 General Elections (Pemilu), which he deemed an understandable phenomenon during a country's political year.
"We really need to curb our expectations in a political year, it's just the cycle, as investment goes down every political year," said Faisal Basri in Jakarta, Wednesday, June 7.
He recalled the 2009 elections where investment growth was only 3.3 percent from previously 10 percent. The phenomenon was recorded again in the 2014 elections where investment value also decreased, although not significantly, from 4.6 percent to 4.4 percent. Finally, in the 2019 elections, investment growth fell from 7 percent to 4.5 percent.
"So yes, indeed investors are minimizing risk, and the biggest risk is the change of government," he elaborated.
The same sentiment was echoed by the Indonesian Regional Autonomy expert, Djohermansyah Djohan, who said maintaining investment growth in a political year is certainly difficult and complicated.
He called for the central government to involve and provide room and opportunities for the regional government to participate in investment plans to prevent stagnation. "If not, investments will be idle during a political year," said Djohermansyah.
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