ASEAN Economy is Targeted to Grow 4.3 Percent This Year
- ANTARA FOTO/Akbar Nugroho Gumay'
VIVA English – Director of ASEAN Economic Cooperation at the Ministry of Foreign Affairs, Berlianto Situngkir, stated that the Indonesian government is targeting a 4.3% growth in the ASEAN economy for this year.
He added that the economies of ASEAN member countries have shown high resilience. "As of the latest data we obtained in 2021, the growth rate was 3.98%, compared to the global growth rate of 2.6%. This clearly demonstrates the ASEAN economy's resilience to shocks," said Berlianto during the online FMB9 discussion held on Wednesday, May 3, 2023.
The Indonesian government will make efforts to achieve this target at the upcoming 42nd ASEAN Summit. According to Berlianto, ASEAN has become the fifth economic power among developed countries, with a total GDP of $3.3 trillion USD and a population of over 650 million, placing it third after China and India.
Berlianto highlighted four main elements necessary for sustained economic growth in ASEAN: a strong health architecture, food security, energy resilience towards clean and renewable economic transition, and financial stability in the region to anticipate external shocks.
"To support the theme of 'Epicentrum of Growth', ASEAN needs to strengthen its presence in creating stability and peace in the region, not only in ASEAN but also in the Indo-Pacific region," he added.
Meanwhile, Head of Regional and Bilateral Policy Center at the Fiscal Policy Agency of the Ministry of Finance, Nella Sri Hendriyetty, explained that Indonesia sees the ASEAN Summit 2023 as an opportunity to encourage ASEAN countries to integrate their economies in the region. One of the efforts to achieve this is by promoting the use of local currencies in regional trade transactions.
"As the Chair of ASEAN, we encourage ASEAN countries to use local currencies in cross-border transactions within ASEAN," she said.
The push for the use of local currencies is part of the Local Currency Settlement (LCS) cooperation, which aims to reduce reliance on the US dollar or dedollarization.
Nella explained that the use of the US dollar can make ASEAN countries vulnerable to the impact of global crises, as the global economy is heavily influenced by the use of the US dollar.
"We know that excessive use of a single foreign currency weakens the economic fundamentals in the long term. So, if there is a significant strengthening of the US dollar, the rupiah will depreciate significantly," said Nella.
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