Indonesia Needs Industrial Policy Reorientation

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  • Bambang Brodjonegoro.

    Bambang Brodjonegoro.

    TEMPO.CO, Jakarta - Deputy Finance Minister Bambang Brodjonegoro said that Indonesia should shift its gear to turn itself into an industrial country in order to improve its trade balance. Bambang said there is an urgency to reroute the country's economic direction, even though the process would take quite some time.

    To this day, Bambang said, Indonesia's trade still relies on the commodity sector. "But this era is over. There should be an industrial policy reorientation," he said yesterday.

    Doddy Zulverdi, economic assessment director at the Economic and Monetary Policy Department of Bank Indonesia, said that Indonesia is exporting more natural resources compared to manufacturing products.

    As a result, when demand from China slows down and the price of commodity declines, Indonesia's export performance is highly affected. "We cannot export to developed countries because they don't really need our natural resources," Doddy said.

    The government is planning to issue two Finance Minister policies next week, in a bid to curb the current account deficit. With the additional policies, Finance Minister Chatib Basri is confident that the deficit can be pushed down to below US$8.4 billion by the end of the year.