"I suggest that projects in the pipeline should be stopped," the economist stated at a press conference here on Wednesday.
Shamdasani, who is also an international trade expert, remarked that massive infrastructure projects built during the past four years of the government of President Joko Widodo and Vice President Jusuf Kalla will admittedly be useful, particularly to face the era of digital economy.
However, the construction of infrastructure projects had led to an overheated economy, a condition in which the economic capacity is unable to keep pace with the rising economic growth, Shamdasani pointed out.
"The infrastructure built this time will be useful in future. However, since they are very fast, I think that the Jokowi government must slow them down. The reserved cash at BI (the central bank) should first be used to stabilize the rupiah. I think it is very wise for state electricity firm PT PLN to cancel or postpone its projects," the economist noted.
The rupiah continued to fall against the dollar, trading at Rp14,920 in the Jakarta interbank spot market on Wednesday morning, down 25 points compared to the previous close of Rp14,895 per dollar.
Negative sentiments in the market, including the United States-China trade war and global crude price hike, have applied pressure on the currencies of developing nations, including the rupiah.
The negative sentiments are expected to worsen unless the Fed slows down the pace of its tough monetary policy.
Reporting by Citro Atmoko
Editing by Suharto
Reporter: Antara
Editor: Fardah Assegaf
Copyright © ANTARA 2018
