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Low Buying Power, Kadin Suggests Govt Provide Incentives

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15 August 2017 10:00 WIB

Image credit: TEMPO/Gunawan Wicaksono

TEMPO.CO, Jakarta - Rosan Roeslani, Chairman of the Indonesian Chamber of Commerce and Industry, argues that the Indonesian government needs to provide incentives to push societies buying power. Rosan said that incentives can build society’s confidence to spend again.

Because according to Rosan, society’s buying power has weakened by their lack of spending rather than the lack of money to spend.

This can be proven by the fact that there has been a significant increase in bank deposits. Rosan revealed that the deposits are the long term 3-6 months, and not the one-month deposits anymore. Society is predicted to keep their assets in banks in an even longer period of time.

Though insignificant, Rosan claims that the growth of online services has also caused the buying power decline. The true elements affecting societies buying power is the high political tension, lack of organized government policies, and the business climate.

Government incentives, according to Rosan, can encourage society to spend their money again. Rosan gave one example such as a temporary tax exemption within a two week period. He says that Thailand has succeeded in applying the scheme.

VINDRY FLORENTIN



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