JAKARTA: The member of the House of Representatives’ Commission XI, which oversees finance and banking, Ecky Awal Mucharam, has called on the government to be serious in straightening out goods distribution flows to ensure commodity supplies can reach consumers in regions across the country, anticipating increases in inflation during Ramadhan and Idul Fitri.
“Results from our work visits in several regions during our recess show that the prime problem of an increasing inflation rate in those areas is on the supply side. So, we are calling on the government to be serious about overcoming the problem,” Ecky said as quoted by Antara on Monday evening.
He said the supply side must get close attention, along with ongoing efforts from the government and Bank Indonesia (BI) to strengthen Regional Inflation Control Teams (TPID). “The government should also not hesitate to, for example, provide fiscal bolsters to ensure the availability of goods in regions,” said the Prosperous Justice Party lawmaker.
The House’s National Mandate Party faction member, Ahmad Najib Qudratullah, criticized the government and BI’s sluggishness as the rupiah exchange rate’s volatility had been far above its assumption of Rp 12,500 per US dollar as stipulated in the 2015 revised state budget (APBN-P). As a result, he said, the people’s purchasing power had been crushed during the first quarter of this year.
The lawmaker went on to say that Indonesia’s domestic consumption had also fallen, which was marked by slow business as capital goods’ and raw materials’ import costs were very high.
“The rupiah plunged, causing people to suffer. The government and BI should have been able to maintain the rupiah volatility so it would be not too far from the government’s assumption in the APBN,” said Ahmad.
Inflation rate and rupiah exchange rate controls were two prime issues highlighted by most of the members in the House’s Commission XI during a meeting to discuss the macro assumptions of the 2016 state budget draft bill (RAPBN), Monday evening.
Most of the House’s factions agreed that Indonesia’s economic growth assumption should be reduced from 5.8 percent – 6.2 percent to 5.5 percent – 6 percent. Inflation should sit at 4 percent plus or minus 1 percent. And the rate for government debt papers (SPN) should be between 4 and 6 percent while the rupiah exchange rate should be between Rp 13,000 and Rp 13,400 per US dollar.
