"This includes internal factors. Some 40 percent of Indonesian bonds are controlled by foreigners. Hence, in the future, foreign ownership of Indonesian debt securities must be reduced," Batubara, who is a member of the House of Representatives (DPR) from the Indonesian Democratic Party of Struggle (PDIP), said here on Friday.
This was disclosed by Batubara, who is popularly called Ari, during the handing over of machinery and equipment assistance from the Ministry of Industry to the small and medium industries in the City of Semarang at the West Semarang District Office.
Ari explained that 40 percent of foreign ownership of government securities can actually be reduced by utilizing idle funds, such as pension funds, to buy these Indonesian debt securities.
"Actually, there are a lot of idle funds, such as pension funds. Instead of being unused and only kept in a bank with a small interest, it is better to use it to buy our debt. To buy our own debt securities would not be dangerous," he said.
Another internal factor, said the House of Representatives Commission VI legislator in charge of trade, industry, investment, cooperatives, small and medium scale business (UKM) and the state-owned enterprises (SOE), is the minus trade balance due to more imports than exports.
"Therefore, pursuing high economic growth must be accompanied by a strong industry. If the industry is not strong, people who are rich and prosperous will import a lot," he said.
This condition has actually happened in the last 10 years; even food needs are imported, such as rice, sugar and salt, said Ari, who is also Deputy General Treasurer of the PDI-P.
"This means that we have no choice but to strengthen the national industry and reduce ownership of debt securities by foreigners so that the value of the rupiah would not fall too much, as it has now," said Ari.
In addition to the internal factors, the weakening of the rupiah exchange rate was also caused by external factors such as pressures on developing countries such as Turkey, Argentina and Brazil, which affected Indonesia.
Reporting by Zuhdiar Laeis
Reporter: Antara
Editor: Andi Abdussalam
Copyright © ANTARA 2018
