Government Targets 4.5 Percent Economic Growth, Fuad Bawazier Former Minister Of Finance In The Soeharto Era: High

Fuad Bawazier. (Photo: Doc. Antara)

JAKARTA - Former Minister of Finance under President Soeharto, Fuad Bawazier, admitted that he did not believe in the economic growth target set by the government. He considered that the target was often missed because it was too high from the realization.

As is known, the government in this case the Minister of Finance Sri Mulyani targets the national economy to grow in the range of 3.7 percent to 4.5 percent throughout 2021. This projection is down from the original which was in the range of 4.3 percent to 5.3 percent.

"Honestly, I increasingly don't believe in the predictions of economic growth rate according to state officials, which are almost always too high and then almost always wrong even though they have been corrected many times," he said in the virtual discussion, Friday, July 23.

Furthermore, said Fuad, the government's overly optimistic economic growth forecast is a form of propaganda to build public and investor confidence.

"I see more of a propaganda effort, it can be for political purposes, maintaining the rupiah exchange rate, maintaining public optimism, investors, and others," he explained.

According to Fuad, the government's economic growth projection of 3.7 percent to 4.5 percent is not supported by real conditions on the ground. Because, MSME actors began to scream, the tourism sector collapsed, and so on.

Therefore, he predicts the realization of economic growth this year is far from the government's estimate of 2 percent in the second quarter of 2021, then minus 0.5 percent in the third and fourth quarters of 2021.

Agreeing, Indef Senior Economist Fadhil Hasan said that the economic rate in the third quarter is potentially below the government's target. This is because of the implementation of the Emergency Community Activity Restriction (PPKM) which is currently changing to Level 4 PPKM.

"I think it makes sense that economic growth in the third quarter of 2021 will be cut sharply compared to the initial prediction of 4-5 percent," he said.

Fadhil said that with the implementation of PPKM Level 4, the handling of the COVID-19 pandemic in the country has not improved, not only economic growth in the third quarter, even the next quarter will face pressure.

Furthermore, Fadhil said, seeing the crisis conditions due to this pandemic, economic activities really needed a long time to return to normal, assuming the pandemic had been handled better.

"Indeed, I think from the start we suspected that the economic and health crisis caused by the pandemic in Indonesia would last a long time. Because from the start we implemented policies that were half-assed as well as in health care," he said.