Indonesia Is Considered To Be In The Global Uncertainty Vortex

Mata Uang & Commodity Observer Ibrahim Assuaibi considers that geopolitical tensions are heating up again in the Middle East, particularly between Israel and Iran, with the involvement of the United States as a third party, have sparked significant global economic turmoil.

"The sharp increase in the yield of United States (US) government bonds marks market concerns over the country's current fiscal imbalance," he said in his statement, Friday, June 20.

He added that Indonesia is in the midst of a complex vortex of global uncertainty and structural changes in the world economy demanding strong domestic resilience, adaptive policies, as well as solid coordination between fiscal, monetary and real authorities.

According to him, although Indonesia cannot control the direction of global winds, this country can still strengthen the national economic screen so that it continues to advance towards inclusive and sustainable development goals, so that Indonesia should not view this global turmoil as something far away and has no impact.

"When developed countries experience fiscal and monetary pressure, developing countries such as Indonesia tend to experience transmission of these pressures in the form of weakening the exchange rate, releasing foreign capital flows, and increasing the interest expense of foreign debt," he said.

Ibrahim said that this situation brought a number of important policy implications for Indonesia, namely first, the government needed to manage fiscal risks with more discipline.

Furthermore, second, the stabilization of exchange rates and financial markets must be a top priority, and the third is that the diversification of infrastructure financing sources needs to be increased.

"Fourth, strengthening food and energy security must be accelerated so that global pressures do not interfere with social stability," he concluded.