RI Joins The IPEF Forum, UGM Experts: Bring Short And Long-Term Profession In Political And Economic Affairs

Illustration (Photo: Doc. Antara)

JAKARTA - UGM's world economy and international political trade expert, Riza Noer Arfani said, Indonesia will benefit politically and economically by joining the new Indo-Pacific Economic framework or IPEF (Indo-Pacific Economic Framework).

For your information, in a ministerial meeting at the IPEF forum, the Indonesian delegation was led by the Coordinating Minister for Economic Affairs Airlangga Hartarto, and accompanied by the Minister of Industry Agus Gumiwang Kartasasmita, the Indonesian Ambassador to the United States (US) Rosan P Roeslani.

In the short term, said Riza, politically it can strengthen the position of the G20 Presidency and ASEAN Forces next year. Because after all, according to Riza, America is still in control in certain economic fields.

"So in the short term diplomacy can be formed by joining the IPEF as a complement to the economic diplomacy that we built in other areas or other schemes such as the RCEP," said Riza in Jakarta, Friday, September 9.

Meanwhile, Riza continued, in the long term, there will be many impacts on the balance of power politically and economically in the region.

"We still doubt what China wants in their involvement in the region. Especially South China's marine profile issues, so from that point on, we still need consideration from other groups such as America, Indo Pacific," he said. Riza said that currently, America's economic condition is not doing well.

They are overshadowed by a recession and a slowdown in the economy. Even so, according to Riza, America still has a chance as a country with great economic powers.

"We see that America's steps so far have focused on tackling the impact of the possible recession. I think if it is associated with the IPEF framework, actually what America is targeting is mainly diverting their sources or economic access from China," said Riza. From the framework of this IPEF cooperation, it is hoped that it will bring benefits to Indonesia and 13 other member countries.

"We need to see if there is something concrete, for example, in terms of increasing American investment in ASEAN countries, especially Indonesia, it needs to be seen first, how many industrial business opportunities they can encourage to expand their business according to the framework designed," said Riza.

Need Foreign Capital Meanwhile, Research Director of the Center of Reform on Economics (CORE) Indonesia Piter Abdullah said the government's efforts to attract investment and promote the potential for economic cooperation were reasonable things to do.

"I think what the Coordinating Minister said is a matter of fairness. It is very normative. All officials, especially the Coordinating Minister for the Economy, must submit the invitation," he said. Piter emphasized that no country in this world can advance without foreign capital.

Therefore, Piter continued, the government's efforts are very relevant to the current condition of Indonesia, which is trying to recover after the COVID-19 pandemic and advancing the economy.

"So, this invitation is very relevant to the current condition of Indonesia which requires foreign capital to spur economic growth as well as create jobs so that it can reduce poverty," he said. In the IPEF forum, the Indonesian delegation also promoted the omnibus law on the Job Creation Law as an effort by Indonesia to encourage structural reforms and asked for US support regarding food problems, especially imports of soybeans from the US.

Related to this, Piter said the instability of global conditions greatly affected food supply.

On the other hand, Indonesia is still importing soybeans to meet domestic needs, so the stability of imports of soybeans greatly affects domestic food prices. "I think it is also very strategic in the midst of the current state of the turmoil in food prices. The government must ensure that imports of food in this case soybeans are not disrupted so that domestic supply is fulfilled and food prices that use soybeans can be stable," he concluded.

For your information, Coordinating Minister for Economic Affairs Airlangga Hartarto attended the Indo-PTM Economic Framework (IPEF) Ministerial Meeting (PTM) in the United States.

On this occasion, Airlangga encouraged American investors to enter Indonesia. "The Indonesia-US bilateral trade volume is targeted to reach 60 billion US dollars. Currently, it has only reached around 37 billion US diesel, so there is even more opportunity to increase cooperation between the two countries," said Airlangga. Airlangga explained, the realization of US investment in Indonesia in 2021 amounted to US$554 billion or around Rp37.5 trillion.

"US investment in Indonesia is still very small, so it needs to be encouraged by more US investment in Indonesia," he said.