BI Governor Calls Geopolitical And Geoeconomic Fragment Change Policy Making

Governor of Bank Indonesia Perry Warjiyo. (Photo: Doc. ANTARA)

JAKARTA - Bank Indonesia (BI) Governor Perry Warjiyo stated that geopolitical and geoeconomic fragmentation provides very basic consequences and changes in policy making and the economy.

"Our policy making will certainly open trade and investment, but more pragmatic, more practical, because we have to win-win solution. This is economic-political diplomacy (political diplomacy of the economy)," Perry Warjiyo said as quoted by ANTARA, Saturday, September 16.

In various parts of the world, he continued, the increase in geoeconomic and geopolitical fragmentation is ongoing.

This is shown from the fragmentation and political uncertainty that occurs in Russia and Ukraine, so that global supplies related to food and energy are reduced.

Tensions between the United States (US) and China also have an impact on geopolitical and geoeconomic fragmentation that can be seen from the decline in export-imports between the two countries, thereby slowing their economic growth.

This is a setback from globalization. Likewise, geopolitical tensions have an impact on exports and imports, not only the US and China, but also other countries in the world," he said.

If you look at academic glasses, the benefits of globalization are trade and open investment that provides benefits for all.

However, the geopolitical tension between the two largest economies in the world creates global uncertainty and risks.

According to Perry, the source of global economic growth is changing, such as India, which has now grown and has the potential to become a new center of growth.

Perhaps in the future, Africa could also become the center of growth given the economic development of some countries from the continent indicating this potential.

This has implications when we not only talk about globalization, but also how open trade and investment in our country need to be changed. In the past, we could be open to everyone, but now we have to be pragmatic. Who will become our trading partners and investment partners are not only AS (and) China, but also need to strengthen relations, (for example) Indonesia and India," Perry said.