Burhanuddin Abdullah Singgung 2005: Rupiah Sekarang Belum Separah Dulu

JAKARTA - Former Governor of Bank Indonesia Burhanuddin Abdullah considers that the pressure on the rupiah at this time needs to be explained more fully to the public. He compared the current situation with Indonesia's experience in facing economic turmoil in 2005.

This was conveyed by Burhanuddin to reporters after meeting President Prabowo Subianto at the Presidential Palace Complex, Jakarta, Friday, May 22.

Burhanuddin said the meeting did not specifically discuss the rupiah. He said the discussion was more about discussing past experiences that could be lessons.

"In 2005, we increased fuel by 126 percent. Only the source is different. Now it is external, it was domestic," said Burhanuddin.

According to Burhanuddin, the impact of pressure then and now has similarities. Therefore, the way it is handled needs to continue to be improved.

Burhanuddin said the current rupiah depreciation was around 5 percent. This figure is still much smaller than the pressure during the previous crisis.

"In the past, during the crisis, it was up to 42 percent. At that time, it was up to 21 percent. Now it's 5 percent," he said.

He assessed that the public needed more explanations so that they did not only see the daily exchange rate.

"Well, this is what perhaps needs to be explained more, more socialized to the public," said Burhanuddin.

Burhanuddin also touched on BI's experience raising interest rates aggressively in 2005. At that time, the BI Rate was raised from 8 percent to 12.5 percent to respond to inflation which was estimated to reach 17 percent.

"I raised it then not 25 basis points. The first was 75, the second was 100 basis points," he said.

According to Burhanuddin, after the policy received a positive response, the rupiah slowly stabilized and inflation fell again in 2006.