Celios: Trump Is A Challenge For BRICS Member Countries

Director of China-Indonesia Desk Center of Economic and Law Studies (Celios) Muhammad Zulfikar Rakhmat. (Photo: Doc. Antara)

JAKARTA - Director of China-Indonesia Dec Center of Economic and Law Studies (Celios) Muhammad Zulfikar Rakhmat assessed that after taking office, US President Donald Trump would be a challenge for BRICS member countries, including Indonesia in the global market.

He is of the view that the global economic uncertainty due to the trade war between China and the US as Trump will have an impact on economic stability in several countries, and this will certainly have an impact on Indonesia.

In addition, Trump's threat to BRICS member countries is to de-dollarize.

"Trump's reaction needs to be watched out for, because he is one of the leaders who proves his words. If, the US imposes a 100 percent tariff on BRICS member countries, of course, Indonesia will be affected by the impact of this policy, it is undeniable that this will also be a challenge for the Indonesian economy in the short or medium term. This will also lead to a sharp decline in export volume, especially for products that rely heavily on the US market," said Zulfikar in his statement in Jakarta, quoted by Antara, Wednesday, January 8.

Previously, Brazil, as the holder of the BRICS presidency this year, on Monday 7 January announced that Indonesia had officially become a full member of the international organization.

Some observers assess that BRICS will be the G7 balancer consisting of the United States (US), Canada, Britain, France, Germany, Italy, and Japan.

As a member of the new BRICS group, Indonesia has the opportunity to participate in the solidarity of South countries aka global South in reducing the current West hegemony.

Executive Director of Celios Bhima Yudhistira hopes that by entering BRICS, Indonesia will not only focus on strengthening relations with China, but also Brazil, South Africa, including Middle Eastern countries.

"The government should not see BRICS as only China's agenda, but there is great potential with Brazil's countries related to the restorative economy, to South Africa regarding the development of the clean energy transition. If it is too pro-China, Indonesia's membership in BRICS is actually in vain to replicate economic relations with China which is already too dominant," he said.

On the other hand, he also assessed that the BRICS alliance did not really provide an advantage for Indonesia because the Chinese economy is projected to slow down, especially after the return of Donald Trump's election which triggered trade protectionism.

Not only that, concerns that the stronger dependence on China still haunts Indonesia.

According to Celios researcher Yeta Purnama, Indonesia should be more aggressive in diversifying partners bilaterally to survive the uncertainty of the global economy in the future.

"The potential for multilateral cooperation will certainly be profitable but if it is in the same circle, when the economies of member countries that dominate like China weaken, it will be vulnerable to having an impact on domestic economic stability," said Yeta.

Furthermore, Celios provides an important note for Indonesia. Joining BRICS can be said to be risky, especially if you focus too much on China.

To avoid this risk, Indonesia needs to play a role in encouraging collaboration in strategic sectors such as the investment sector and infrastructure development targeting the needs of developing countries, and directing investment in projects that can strengthen the economic independence of member countries.

In line with this, Indonesia needs to play a role to encourage green investment cooperation in member countries by developing an environmentally friendly capital market.

"When it comes to global South, the main urgency that cannot be ignored is the dominance of investment in the extractive sector. So BRICS is also expected to highlight the potential for green investment cooperation for green growth in the coming years," explained Yeta.