RI ready to face Fed’s tapering policy

JAKARTA. Indonesia is prepared for the various problems linked to the global economy, including the US Federal Reserve’s policy of easing its monetary stimulus.

Presidential spokesperson Julian Adrian Pasha said on Monday that President Susilo Bambang Yudhoyono had asked for input from his economic ministers on the matter.

“[The policy’s implementation] is not yet confirmed; but, there are possibilities that the Fed will eventually implement its tapering policy. The global economic situation depends on the economic situation in the US,” Julian told journalists as quoted by Antara news agency.

“We have discussed what measures will be taken to overcome the situation and formulated the right policy on when these measures will be implemented. The [tapering] policy could have a wide-ranging economic impact; however, Indonesia must be ready to deal with the situation,” he went on.

President Yudhoyono held a limited Cabinet meeting to discuss the latest domestic economic developments at the Presidential palace in Cipanas, Cianjur, on Monday.

Julian said that during the meeting, the President had received explanations on the current national economic situation, including the rupiah exchange rate which has continued to depreciate against the US dollar over the past several days.

“During the last several days, Indonesian economic conditions have been depressed. It was conveyed by the Coordinating Economic Minister (Hatta Rajasa) that two factors have caused this situation. First, the internal condition, namely the current account deficit, and second, the external factor – speculation that the Fed will start its tapering policy,” said Julian.

“The anticipatory measures that will be taken once the Fed’s tapering police takes effect were also explained to the President,” he said, without providing details.