OJK: RI Needs New Sources Of Growth, Can't Just Rely On Consumption

Illustration (Photo: Doc. Antara)

JAKARTA - Chairman of the Board of Commissioners of the Financial Services Authority (OJK) Wimboh Santoso admitted that so far Indonesia has been quite dependent on the level of public consumption as a source of economic growth. This happens because most of the gross domestic product (GDP) is directly absorbed by the domestic market.

According to him, this condition carries its own risks. One of them is when there are restrictions on mobility like now.

"Growth is currently still supported by the consumption sector, which is highly dependent on people's mobility," he said in a press statement after holding the Board of Commissioners' Meeting (RDK) on Wednesday, August 4.

Wimboh added, this vulnerable situation must be addressed by all stakeholders so that the impact of the pandemic does not cause a deep enough effect.

"For this reason, it is necessary to open up space for new sources of economic growth that are more sustainable in addition to the consumption sector," he said.

This step is considered to be a solution to potential problems that often arise as a result of tightening community mobility.

“So this new source of growth can still absorb labor. We assess that the export-oriented business sector can be chosen so that the economy can grow more stable and sustainable," he said.

As is known, the pace of the economy experienced a significant rebound from the beginning of the year to the end of the first half of 2021.

"Economic indicators until the end of the second quarter of 2021 show an improving trend towards national economic recovery," he added.

In detail, OJK reported that credit began to record a fairly high increase in June 2021 of 1.83 percent (year to date), so that the prediction of economic growth in the second quarter of 2021 of 7 percent can be achieved.

However, since the COVID-19 delta variant has spread in the country, productive activities have been suppressed again as a result of the policy of the Implementation of Community Activity Restrictions (PPKM).

"Meanwhile, along with the increase in active cases in June 2021 which restrained community activities, it was reflected in the decrease in the increase in community activity from 6.7 percent (May 2021) to 5.2 percent, which could slightly affect the original prediction," he said.

"The effectiveness of implementing PPKM level 4 along with increased distribution and implementation of COVID-19 vaccination, as well as increasing public awareness in complying with health protocols, will be able to accelerate the recovery of community economic activity going forward," concluded Wimboh.