ISEI commends govt's measures to mitigate economic impacts of COVID-19

ISEI commends govt's measures to mitigate economic impacts of COVID-19

Situation of a shopping mall in Jakarta. (ANTARA FOTO/M Risyal Hidayat/aww)

Bandung, West Java (ANTARA) - Aldrin Herwany, the West Java coordinator of the Association of Indonesian Economists (ISEI), praised the government's steps to mitigate the impacts of coronavirus (COVID-19) on the country's economy.

"We support all government policies that are crucial for bringing about an improvement in Indonesia's economy, especially in West Java, the province, with the largest population," Herwany noted in a statement here on Wednesday.

Herwany opined that Indonesia's economic growth will witness a significant slowdown in future.

The COVID-19 crisis has directly changed and limited social interactions and economic activities, including in West Java.

The pandemic has swiftly driven the world into an economic recession and slashed economic growth this year to below five percent or lower as compared to last year.

"The coronavirus crisis will trigger an economic slowdown. The state orders its citizens to stay at home, even as the business world continues to lose money. Several investors have also withdrawn their capital," he stated.

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He pointed to the highest number of layoffs potentially occuring in the labor-intensive sector if the outbreak were to continue until the Eid al-Fitr Islamic Festivity (Lebaran) this year, and employers would undoubtedly opt to reduce the number of employees to curtail expenses.

The economist and lecturer of Padjadjaran University stated that apart from the industry, the MSME sector bore the maximum brunt of the corona outbreak since it had limited capital.

"The impact of the coronavirus is felt most severely by the labor-intensive sector and MSMEs. Massive layoffs might potential occur in the industry. Several MSMEs might also go bankrupt," he emphasized.

Herwany commended the government for currently preparing a new program called the Job Loss Guarantee (JKP) as a follow-up to the Cipta Karya Bill.

Herwany noted that under this program, employees affected by the termination of employment (PHK) will receive benefits from the government, and the social allowances provided herewith are segregated into three forms: cash, vocational training, and access to new jobs.

"Hence, the Employment Creation Bill can be the answer to realizing economic recovery after the coronavirus outbreak," he stated. Related news: Indonesia ready to face global economic slowdown amid corona outbreak

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