Is the 8% Economic Growth Target Just Rhetoric? This is a Sharp Analysis of the CELIOS Economist
JAKARTA - The economic growth target of 8 percent which is often chanted by the government has reaped sharp criticism from economists Celios. Director of the Fiscal Justice Center of Economic and Law Studies (CELIOS), Dr. Media Wahyudi Askar, assessed that the figure more reflects political optimism than an economic strategy based on the real sector.
According to Wahyudi, the latest presidential speech which framed the situation of the country in the shadow of geopolitical threats and global wars showed an old pattern. The government is considered to use the narrative of developmental nationalism, where the State Budget (APBN) is positioned as a fortress or 'tool of struggle' to face the chaos of the world.
"However, there is a contradiction here. On the one hand, the narrative is as strict as that, but at the same time, the president is trying hard to calm the market," Wahyudi said when contacted by VOI, Wednesday, May 20.
Ambitious 8 Percent Target in the Middle of Economic Stagnation
Wahyudi added that the economic growth target of 8 percent - which has been the main selling point since the campaign period - is still very weak and too ambitious. He reminded the fact that for the past decade, Indonesia's economic growth has stagnated at around 5 percent.
This situation is exacerbated by the tendency of public distrust (distrust) of data released by the government.
"To be able to jump to 8 percent, Indonesia needs large-scale industrialization, a massive productivity surge, and radical bureaucratic efficiency," he explained.
The Growth Machine that is Not Clear: MBG and Danantara are Questioned
The biggest criticism he directed at the roadmap for achieving the target. In the official government speech, it was not explained in concrete terms what would be the main driving force for economic growth.
Wahyudi doubted several programs and superholding institutions that have been touted by the government, including:
Free Nutritional Meal (MBG) Program: It is doubtful that it can become the main engine to significantly drive macro economic growth. Andantara (Ananta Nusantara Power Investment Management Agency): This institution has not shown any movement or real impact in the past year."The speech did not explain what the growth engine actually was. Is it MBG? I'm not so sure. If Danantara, in the last year it has not gone anywhere," said Wahyudi rhetorically.
In the end, he concluded that for investors and business actors who understand the dynamics of the field, the 8 percent target is still limited to rhetoric. "It is more of a political optimism than an economic strategy based on the real sector," concluded Media Wahyudi Askar.