Chatib Basri: In Times Of Crisis, The Middle And Lower Classes Are Also Like Poor People

Former Minister of Finance, Chatib Basri. (Photo: Instagram @chatibbasri)

JAKARTA - The corona virus pandemic or COVID-19 that occurred in Indonesia has brought economic activity to a halt. As a result, the poor groups in Indonesia are depressed. However, apart from the poor, the middle class group is considered to have also received attention from the government.

The former Minister of Finance, Chatib Basri, said that currently Indonesia's economic conditions are experiencing changes due to the COVID-19 pandemic. The crisis caused by this virus is targeting all sectors. Therefore, the government must also pay attention to middle-income groups.

"I suggest that the middle income group also get social protection. Indeed they are not poor, but if they do not do activities they will not have money. If they do not have money they will leave the house," he said, during a discussion on the Commonwealth Bank Premier Banking and Market Outlook. , Tuesday, May 12.

Chatib explained, currently there are 115 to 120 million aspiring middle class or lower-middle class people who need economic assistance from the government.

"They are middle class, but they don't get social assistance, they don't have savings. At times like this they can fall into poverty," he explained.

Furthermore, Chatib said, if one family is assumed to need assistance of around IDR 1 million per month, then IDR 30 trillion per month will be required. Thus, in four months a budget of IDR 120 trillion is required.

According to Chatib, the budget to cover the lower middle class can be taken from the reallocation of government trips amounting to Rp.43 trillion. Because, in a situation where Large-Scale Social Restrictions (PSBB) are in place, it is impossible for anyone to travel on an official basis.

Then, continued Chatib, the budget can also be obtained from the infrastructure budget which can be temporarily stopped. Then, infrastructure projects can also be shifted until next year, and only the maintenance budget is still used.

"It could also be the physical construction of schools. Currently learning online is not necessary," he said.

In addition, said Chatib, the government could also issue global debt securities, or talk to foreign agencies to help.

On the other hand, Chatib said, currently Indonesia's economic fundamentals are in good condition, so that recovery will be possible soon after the pandemic ends. When June ends, he estimates, economic recovery will be faster, namely the end of this year.

"If it is longer, September, it needs 6 to 8 months of consolidation. So the recovery will only be in the middle of 2021. In December, the recovery will only occur around the second half of 2021," he said.