Indonesian President SBY takes economic measures in Jakarta

Indonesia is the world’s largest archipelago with 650 inhabited islands. It is difficult to manage for sure and its economy is described as follows by the CIA factfile.

‘Indonesia, a vast polyglot nation, has restored financial stability and pursued sober fiscal policies since the Asian financial crisis, but many economic development problems remain, including high unemployment, a fragile banking sector, endemic corruption, inadequate infrastructure, a poor investment climate, and unequal resource distribution among regions. Indonesia became a net oil importer in 2004 due to declining production and lack of new exploration investment. As a result, Jakarta is not reaping the benefits of high world oil prices, and the cost of subsidizing domestic fuel prices has placed an increasing strain on the budget. Keys to future growth remain internal reform, building up the confidence of international and domestic investors, and strong global economic growth. In late December 2004, a major tsunami took nearly 127,000 lives, left more than 93,000 missing and nearly 441,000 displaced, and destroyed $4.5 to $5.0 billion worth of property.’

So there it is, not exactly a ‘A’ grade. One good thing though the man at the helm, President SBY is an honest guy and has recently announced he plans to boost government spending to get the economy rolling again. Inflation in Indonesia is at 18.4% and with the oil situation, plus the downturn in tourism, the economy has slowed.

SBY is trying to do the right thing, which may not make him popular or get instant results, but he is a guy with his head screwed on and is working with what he’s got.