BI: Must Be Careful in Facing the Global Economic Conditions

Source: Dimas Ardian/Bloomberg

Welcoming the G20 Indonesia in November, Bank Indonesia (BI) reminded that all elements of society must respond carefully to global economic conditions and phenomena filled with volatility, uncertainty, complexity, and ambiguity.

Bank Indonesia (BI) Senior Deputy Governor Destry Damayanti said that the International Monetary Fund (IMF) had even revised its projection figures due to global economic conditions.

Based on the latest IMF data in October 2022, the IMF revised downwards on world economic growth which reached 3.2 percent in 2022 and fell to 2.7 percent at the end of 2023.

“The current global economic turmoil, which is currently ongoing, must be faced with caution,” said Destry in Indonesia’s Strategic Role in the G20: Expert Perspectives, in Soho Pancoran, South Jakarta, Thursday (27/10/2022).

She said that uncertainty was accumulating with inflation triggered by a global supply shock that was exacerbated by the Russia-Ukraine geopolitical conflict, which caused various countries to implement protectionist policies and the impact of climate disturbances.

In addition, the policies taken by some central banks, especially in developed countries, to raise their benchmark interest rates eventually triggered a recession in developed countries and gave spillovers to developing countries.

Moreover, she said, each country has different characteristics in maintaining the momentum of recovery as well as economic stability.

“The policies taken will certainly affect the economic conditions of other countries and this will become a circle crisis that will have no end,” she added.

Therefore, Destry sees that it takes synergy and enthusiasm to recover together and find solutions to the crises that occur.

In the G20 Indonesia Presidency, Destry said that Indonesia gave priority so that each member could voice his views so that the G20 theme: recover together, recover stronger was more relevant.

“The Indonesian presidency strives to continue to maintain the global development goal, which is to encourage stronger, more sustainable, balanced, and inclusive global economic growth,” she concluded.