Prospect of RI`s economy in 2010 good: Observer

Indonesia`s economic prospect will be better if the world economy begins to recover IN 2010, director of Center for Information and Development Studies (Cides), Umar Juoro said.

"If the world economy recovers in 2010, Indonesia`s economic growth could return to the six percent level," he said here on Sunday.

He said that a six percent growth in Indonesia`s economy would be able to boost exports and imports, which would also have impact on domestic and foreign investment.


"The economy would be developed further if the infrastructure development boosted significantly and the stimuli polices could be implemented perfectly," he said.

Juoro said that the economic challenges in the future included infrastructure development and they way how to balance economic growth.

The problem in the infrastructure development is not about financing but about structural matters such as land clearance, tariffs and other legal certainties.

"The structural problems could not be solved soon but improvement made in stages would boost a better economic development," Juoro said.

Referring to the economic growth in the current global financial crisis, Juoro said that in the first quarter of 2009 Indonesia`s economic growth was recorded at 4.4 percent, which was supported by people`s consumption which grew 5.8 percent and government expenditures.

He said that although the country`s exports experienced a negative growth by 20 percent, the current account and trade balance remained positive as the negative growth of imports was bigger than that of exports.

Of late, the rupiah value and capital market index have also gained significant strength. This is because Indonesia`s economic prospect was considered goods so that investors invested their funds in a market which they expected to provide high gains.

"The rupiah value and capital market index are predicted to continue to gain strength, although in certain times they would occasionally weaken," he said.

So, he said, it is not an exaggeration to say that the rupiah will reach Rp9,500 level per US dollar and the capital market index will reach 2,300.