JAKARTA - The government is paying serious attention to the condition of the Indonesian capital market. As is known, the Composite Stock Price Index (JCI) has been recorded as weakening throughout the last week.
Danantara Indonesia CEO Rosan Roeslani said the dynamics in the stock market have both direct and indirect impacts on the national economy, ranging from large business actors to the MSME sector.
Furthermore, Rosan said the capital market is now one of the main barometers of investor confidence, especially foreign investors, before they invest directly or foreign direct investment (FDI) in Indonesia.
"Moreover, our capital market continues to grow and this development makes our capital market the main concern of foreign investors because indeed confidence in investment, especially FDI, one of the main indicators is confidence in the capital market first," said Rosan in a public dialogue at the Indonesia Stock Exchange (IDX) Office, Jakarta, Sunday, February 1.
Rosan explained that compared to direct investment which requires long-term commitment, the capital market provides flexibility for investors to enter and exit in a relatively shorter time. Therefore, confidence in the capital market is an important foundation for broader investment flows.
"Of course, confidence in our capital market is the main key in our desire to get direct investment which will certainly have a positive impact on our economy," he said.
Previously, UPN Veteran Jakarta Economist and Public Policy Expert Achmad Nur Hidayat assessed that the temporary trading halt on the Indonesia Stock Exchange (IDX) was only able to calm market turmoil in the short term and did not immediately restore global investor confidence.
According to him, international market confidence cannot be restored only through a 30-minute trade pause, but rather through consistent, measurable, and verifiable reforms.
He emphasized that market authorities are not enough to merely state that Indonesia's economic fundamentals are strong, but must show a real improvement in governance and market openness.
"Authorities are not enough to just say that the fundamentals are strong. Authorities need to show that governance and openness will be improved with a clear roadmap, including improving data quality, transparency of ownership structures, and certainty of rule enforcement," he said in a statement, Thursday, January 29.
He welcomed the IDX's plan to discuss with MSCI the need for data and improvement measures, but emphasized that the global market is waiting for proof of implementation, not just commitment.
Furthermore, he said that transparency of share ownership must be improved from merely fulfilling formalities to openness that allows verification.
"If the public ownership reporting system is still based on a certain threshold, while more detailed data can only be read through other sources, then there will always be a perception gap," he explained.
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