The Breakthrough Of The Minister Of Finance Of Purbaya Is Considered To Be Accompanied By Banking Readiness

The Minister of Finance of the Republic of Indonesia, Purbaya Yudhi Sadive. (Photo: Doc. Antara)

JAKARTA - Jember University (Unej) economist Hadi Paramu Ph.D said that the breakthrough of the Minister of Finance, Purbaya Yudhi Sadewa, was quite important, but the injection of funds had to be balanced with banking readiness and project feasibility.

"The latest fiscal policy ideas show proactive economic management mindsets, but their implementation demands the readiness of financial actors and in-depth analysis," Hadi said in a written statement, quoted by Antara, Monday, October 13.

The lecturer on financial management at the Faculty of Economics and Business, Unej, gave a response to the breakthrough policy steps taken by the Minister of Finance that what Purbaya did was quite important and had extraordinary breakthroughs.

"The point is that he pays attention to 'idle capacity', especially 'idle cash'. Business is interesting because 'over-liquidity' is not good, but lack of liquidity is also dangerous, so what is needed is balance," he said.

He explained that focusing on the use of unemployed resources is a strategic step to drive the domestic economy.

"If there is a 'resource' that can be used to drive the domestic economy, then it should be used. But the good idea is not enough; after the funds are disbursed, there are other parties who have big tasks, namely banks that are trusted to distribute these funds," he said.

He also emphasized that there are consequences for distribution agencies and facilities provided not only "blessing", there is large homework for banks to distribute them on target, and also reminded that the funds are not free.

Minister Purbaya said that the funds had costs to be paid to the state, if I'm not mistaken, around 4 percent. This means that if the funds are not absorbed or misused, there are costs that must be borne," he said.

He also highlighted the incentive mechanisms and sanctions set up by the government. On the one hand, there is a great opportunity to drive the economy, on the other hand there is a "punishment", so banks must work more proactively and responsibly in channeling funds so that the economic impact can be optimal.

"Imagine that there is a disbursement of fresh funds of IDR 200 trillion in one region, ideally the economy will move. But we have to look at it as a transformation process, one action will produce a series of impacts that need to be learned. The impact is not always instant; it tends to be medium to long term and demands the patience of many parties. ," he said.

He emphasized the importance of accuracy in terms of business actors. From the company's perspective, expansion is not just an issue of the availability of funds, there must be clear market prospects and expansion requires fresh funds, either through equity or liabilities.

"Kuncinya, perusahaan harus melihat peluang terlebih dahulu. Tidak cukup hanya memberikan fasilitas baru lalu dana terintong saja tanpa kajian kelayakan yang matang," katanya.

He reminded that there is interaction between the supply and demand side. The offer is there, namely disbursement of funds; but if the demand for projects or expansion is not sure about market prospects, even though the funds are cheap, they are not necessarily optimally absorbed. Therefore, an in-depth analysis is needed before implementation.

He explained that fiscal policy breakthroughs must be appreciated as a stimulus, but their effectiveness depends on governance, capacity for distribution and readiness of business actors.

"This step is interesting and has the potential to trigger growth, but must be followed by strict monitoring, evaluation and collaboration between the government, banking, and the private sector so that the goal of economic recovery and transformation is truly achieved," he said.