"Currently the growth rate is 4.9 percent, which could have been higher and better in quality with the availability of resources," KEIN chairman Soetrisno Bachir told reporters after a meeting with President Joko Wisdodo (Jokowi) here on Tuesday.
Soetrisno said at the meeting KEIN suggested a number of strategic steps to the president in order to achieve the 7 percent growth.
Deputy chairman of KEIN Arif Budimanta said 7 percent growth is achievable by Indonesia if it could maintain 10 percent growth for investment every year.
"The Philippines and India could post a 7 percent growth; even African countries like Rwanda grew 10 double digit," Arif said.
In order to achieve a 7 percent growth, the government needs to keep a positive growth of at least three percent for exports, and consumption growth of 5 percent a year, he said.
He said according to President Jokowi investors are serious in doing business in Indonesia.
"They come in queue to invest in various sectors mainly infrastructure and other direct investment projects though there are bottlenecks in the middle to low levels," he quoted the president as saying.
He said the process of policy integration must be in line from the center to the regions.
"Otherwise it would be difficult to maintain a 10 percent growth for investment," he added.
He said there must be integration in infrastructure development with industry, transport, port and energy.
KEIN also recommended infrastructure development in the regions through special fund allocation should be based on local resource base.
"We also suggested to use rural fund aid to finance labor intensive projects to help create job in poor areas," Arif said.
] He said the president appreciated the recommendations given by KEIN.
KEIN also recommended a cut in lending rate not to be too high compared with interest rates in neighboring countries.
Soetrisno Bachir said KEIN would offer a concept to cut lending rate, without intervention by the government.
He said KEIN have methods to cut the interest rates, adding,"We will give it to the president."
Banks already cut the interest rate to less than 10 percent but it could still be cut lower, he said.
"Singapore, Malaysia and Thailand could use lower interest rates. No reason we could not," he said.
KEIN also pointed to the growing gap between small and medium enterprises and large corporations.
KEIN suggested development of self supporting oil palm farmers.
Self supporting oil palm farmers need support from the government through distribution of plantation lands.
"Currently there is a company controlling millions of hectares of oil palm plantations while there are many landless farmers. There must be concrete program of the government, not just theory," he said.(*)
Editor: Heru Purwanto
Copyright © ANTARA 2016
