TEMPO.CO, Jakarta - Aberdeen Asset Management president director said that US President Donald Trump’s plan has triggered a capital outflow from Indonesia. President Trump is planning to apply a stricter policy during his terms of office.
The market is also waiting for the realization of the protectionist policy, considering that the United States has already signaled to increase their interest rate up to three times this year.
According to Sigit, Indonesia can use the momentum by becoming a major commodity exporter for the United States and be a part of the development and construction taking place in the U.S.
“I think if that does happen, Indonesia’s major export is in the commodity [sector]. America focuses on manufacturing. Meanwhile, if demands on commodities increase, it will make the domestic consumption better,” Sigit said during a press conference held at his office in Jakarta on Tuesday, January 24, 2017.
Bharat Joshi, investment director at Aberdeen Asset Management, added that increasing commodity prices will push the gross domestic product growth, which is expected to lead to a positive multiplier effect.
Bharat further explained that per 2016, commodity prices have started to recover from a drop occurred since 2011.
“Hopefully, this American policy would bring a form of improvement, because in order improve the manufacturing [sector] they would also need commodities such as coal, iron ore, and others,” Bharat said.
DESTRIANITA