TEMPO.CO, Jakarta - Analyst from the Institute for Development of Economics and Finance Eni Sri Hartati said now is not the right time to increase fuel prices due to sluggish economic condition based on data released by the Central Statistics Agency.
“The government must carefully calculate the data,” Eni said on Friday, November 7, 2014.
By the third quarter of 2014, Eni said, the national economic growth rate has yet hit five percent due to rising interest rate, fuel price and electricity price. As a result, public consumption was focused on primary necessities, particularly food.
The decreasing purchasing power also caused sluggish business activities in several industries, including textile.
“Over the last six months, no goods have been released from the warehouse. This reflects that public’s purchasing power has dropped,” Eni said.
According to Eni, fuel price hike will plunge public’s purchasing power even lower, particularly those who are categorized as lower middle class people. To mitigate such an impact Eni asked the government to prepare a proper strategy.
“Programs such as Indonesia Healthy Card and Indonesia Smart Card would not be enough because there are still issues with the budget,” Eni explained.
Eni argued that there are other ways to reduce subsidy, for example, by increasing the efficiency of the national energy management. President Joko “Jokowi” Widodo should find a way to be independent from oil brokers, such as Petral.