Basri, who is also a former finance minister also said, Indonesia has a broad domestic market, so the impact of the economic slowdown will not be as big as the one that Malaysia and Singapore will experience.
"Hence, the economic slowdown is only from 5.2 percent to 5.1 percent. For other countries, it can be bigger," Basri noted after the Inclusive Economic Growth international conference: Reducing Poverty and Inequality as part of the 2018 International Monetary Fund (IMF)-WB Annual Meeting in Kuta, Bali, Wednesday.
The IMF at the World Economic Outlook provided a projection of Indonesia`s economic growth of 5.1 percent in 2018 amid risks of global uncertainty due to the trade war.
Basri confirmed that the global economy is currently at risk from a trade war between the United States and China.
The risks are generated mainly from a decline in Indonesian exports to the two major economies of the world.
The UI academician remarked that Indonesia`s exports to China mostly constituted auxiliary raw materials, while Indonesia`s exports to the United States were mainly garments and manufactured products.
"Hence, if there is a trade war between the US and China, then there is a risk that China`s exports to the United States will decline. If China`s exports to the US decline, its demand for raw materials will certainly also decline. Hence, Indonesia`s exports will certainly be affected," Basri noted.
China`s economic slowdown will also affect the Association of Southeast Asian Nations, given the high exports of countries in Southeast Asia to China.
Reporting by Calvin Basuki
Editing by Andi Abdussalam, Bustanuddin
Reporter: Antara
Editor: Fardah Assegaf
Copyright © ANTARA 2018
