Rupiah Plunges to 14,700/US$, Trade Minister Worries
28 September 2015 12:12 WIB
TEMPO.CO, Jakarta-Trade Minister Thomas Trikasih Lembong admits his fears over Indonesia's and the world's depleting economy. His main concern stems from the rupiah exchange rate that continues to weaken over the greenback, and has now reached Rp14,700 per US dollar.
"I am concerned, this is different. Something has changed, and it needs a different level of seriousness from normal conditions," he said when delivering a speech at the inauguration of the ASEAN Economic Community (AEC) Center in his office Monday, September 28th.
Thomas asks the public as well his ministry employees to work harder. The rupiah correction has sparked concerns over Indonesia's competitiveness in global markets.
When a currency continues to plummet, production costs and raw material expenses incurred by businesses become higher and can result in profit losses. The rupiah needs to rebound, especially since Indonesian businesses will enter the AEC at the end of this year; facing tough competition from international industries.
"We have to boost the competitiveness of our people and our SME industries thoroughly," he said.
The minister added that when production costs continue to rise and the rupiah continues to weaken, Indonesia's strength in facing global markets drops.
To overcome these shortcomings, Thomas sees the AEC as a way out. By uniting forces across Southeast Asia; a region with a total economic value of US$2.5 trillion, Indonesia would have a better chance.
URSULA FLORENE
