Indonesia faces an overhang of Crisis “Syndrom”
By: Prof. Tri Widodo, Ph.D

Are  there any reasons for anybody to countenance the possibility of a new chapter of  the economic crisis in Indonesia? Three macroeconomic issues that are worth serious attention in relation to latest developments in Indonesia economy. The list includes economic growth,  unemployment and stabilization.

Economic growth that has weakened 
Economic growth registered in the last three quarters attest to a weakening economy. The target set for economic growth in the revised annual budget 2013 was  6.3% , which in all likelihood will be difficult to achieve.  Bank Indonesia (2013) and  BPS (2013) indicate that conditions over the last two quarters pointed to economic growth of 5.8%. The implication of that is clear, for according to Okun’s law,  low economic growth means that the  economy has limited capacity to absorb employees. Apparently, the  trickle-down effect from macroeconomy that posts growth of  5.8% , does not have ample capacity to absorb employment, “the state of microeconomy does not have as much  spackle as the macroeconomy” due to structural weaknesses,  such as competitiveness of manpower, infrastructure and so on. read more

Postponement is not a Choice;   Fuel Subsidies is growing “Time Bomb” that is Holding the Economy Hostage

By : Dr. Rimawan Pradiptyo[1]

History Repeated

For the umpteenth time, during the reformation regime, Indonesia faces a dilemma which is associated with reducing fuel subsidies. Various road maps on how best to reduce fuel subsidies have been proposed since 2008, neither of which as it turned out, were a far cry from interests of politicians. Our collective memory is still fresh with government proposal to regulate and control the consumption of fuels in 2010, which was supposed to implemented in phases starting with Jakarta, and afterwards to cover the whole country by late 2013. However, apparently the plan failed to get off the ground due to the difficulty of acquiring requisite land for expanding storage fuel tanks that refuelling stations faced, which was compounded by the DPR rejection of research findings on the   fuel policy and the best policy forward , by the team that comprised three Universities UGM-ITB-UI. read more

By A. Tony Prasetiantono[1]

The year 2013 is a crucial one from the vantage point of political economy, because it sets the stage for next year, which will be a year of politics in which the conduct of elections for both the legislature and the President will be getting underway. In common parlance, such a year is often referred to as the year of living dangerously. However, I have the boldness to assure all, that there will not be economic and political uncertainty simply because of the   general elections. read more