Bank Indonesia (BI) has stated that market players and the public should not worry about a potential second economic crisis spread by a number of world economic institutions.
“Now domestic economic conditions are fully under control,” said Burhanuddin Abdullah, BI Governor, in Jakarta last week.
“Even the position until midyear is still in surplus, so it can still be contractive,” he said.
The Government's Report on the First 2007 State Budget Implementation says that up to mid-June, there has been Rp23.6 trillion budget surplus or a rise of Rp9.7 trillion compared to the same period's surplus last year.
According to Burhanuddin, Indonesia's payment balance (NPI) surplus of US$3.7 billion in June, higher than the initial estimation of US$1.1 billion, also supports economic stability.
The payment balance surplus was not gained at the time before the 1997 economic crisis.
Then, NPI was in continuous deficit.
“Our NPI surplus only happened in 1952 during Korean war
and the 1974 oil boom,” said Burhanuddin.
The last factor, he said, was the economic institutional condition which is also stronger.
Based on BI's monitoring, the banking sector, which used to be a problem, in fact grew stronger.
“So there's nothing to worry about,” said Burhanuddin.
Last week, several institutions warned about the possibility of an economic crisis.
The World Bank, for instance, warned Indonesia about soaring hot money (short-term capital flow) to capital markets.
The flood of foreign capital coming into developing countries' markets and slight differences between domestic interest and international market interests can be very risky.
The Asian Development Bank has suggested Asian countries stay alert about a potential economic crisis like what happened ten years ago.
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tempo
Labels: Bank, Economy, Indonesia, Internet News, Money
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