Amid Global Uncertainty, Coordinating Minister Airlangga Said The Government Would Stay Alert But No Need To Be Reactive

Coordinating Minister for Economic Affairs Airlangga Hartarto. (Photo: Doc. Antara)

JAKARTA - Amid global uncertainty due to the Iran and Israel conflict, the Government said it would not be too reactive in responding to the conflict from geopolitical tensions in the Middle East.

Coordinating Minister for Economic Affairs Airlangga Hartarto emphasized that the Indonesian government does not need to be reactive in responding to conflicts in the Middle East, and ensures that it will continue to maintain economic stability and the domestic financial market from the impact of the conflict.

"We don't need to be reactive because from an Iranian point of view, the foreign minister said it wasn't from Israel, so we just monitor it and we don't need to be reactive," said Airlangga when met at his office, Jakarta, Friday, April 19.

According to Airlangga, the turmoil in the financial market that occurred was not caused by domestic economic problems but only market reactions to the tension of conflict in the Middle East.

"The impact is not a day. We can see that even though the market reacts negatively in various countries, it has decreased, not only in Indonesia. Japan too, then also neighboring countries, so we will monitor it," he said.

According to Airlangga, Western countries, especially the United States, have stated that they do not want to be involved. Likewise with Jordan, Egypt, and Saudi Arabia will try to avoid escalation of conflicts.

"Other Middle Eastern countries have no interest, so everyone is holding back, so we'll see, don't be reactive to ourselves," said Airlangga.

Airlangga emphasized that the government continues to take anticipatory steps so that conflicts in the Middle East do not have an impact on the pace of the national economy.

"If we monitor it, the important thing is that the range depends on supply and demand, so in a situation like this, if there is no interest in buying dollars, don't buy it, because we have to take care of future needs," he said.

Airlangga emphasized that the government will optimize the role of the state budget (APBN) to reduce the impact of geopolitical tensions based on previous experience during the Russia-Ukraine conflict and during the COVID-19 pandemic.

The most devastating war was when Ukraine was due to Covid-19, there was an increase in commodity prices because the embargo of food and oil prices was also out of control and we can control it with existing mechanisms. We guard the supply chain, we guard the export market, then we also use the state budget as a shock absorber," he said.

For information, citing Bloomberg, the Rupiah exchange rate on Friday, April 19, 2024, the rupiah spot exchange closed down 0.50 percent to the level of Rp. 16,260 per US dollar. Similarly, the Jakarta Interbank Spot Dollar Rate (Jisdor) exchange rate of Bank Indonesia (BI) closed down 0.63 percent to a price level of Rp. 16,280 per US dollar.