BI drew attention to this aspect at the Third Meeting of Finance Ministers and Central Bank Governors of the G20 countries (FMCBG) under the Brazilian Presidency, which was held on July 25-26, 2024, in Rio de Janeiro, Brazil.
"Global uncertainty, such as monetary policy divergence and high public debt in several developed countries, has had an impact on the limited ability of developing countries to maintain economic stability and growth," BI Governor Perry Warjiyo noted in an official statement in Jakarta, Monday.
Hence, Warjiyo called on developed countries to take steps to overcome the spillover of global challenges to developing countries.
The steps encompass strengthening the transparency of monetary policy to provide clarity on responses and policy directions for actors in the financial sector, maintaining perceptions, and calming market reactions so as to strengthen global stability.
Other necessary actions are implementing measures to reduce excessive debt levels and implementing a more prudent sustainable fiscal policy, as well as strengthening coordination of fiscal and monetary policies and structural reforms to increase productivity.
At the meeting, the ministers and central bank governors of the G20 members agreed that the global economy is growing resiliently but is still overshadowed by uncertainties that have the potential to disrupt medium-term growth prospects.
Hence, the G20 agreed to optimize international cooperation.
In the financial sector, the ministers and central bank governors viewed that the resilience of the global financial system remains maintained, supported by solid regulations and supervision.
In the future, efforts to strengthen resilience on the operational side need to continue to be a concern in line with the increasing use of digital technology.
BI emphasized the importance of comprehensive risk assessments, good governance, effective cyber incident handling and recovery planning, and the availability of technology and infrastructure capable of mitigating risks.
The Third Meeting of the G20 FMCBG under the Brazilian Presidency continued discussions on various important agendas under the main theme of the Presidency, "Building a Just World and a Sustainable Planet".
Topics discussed included the global economic outlook and ongoing global challenges, the financial sector and financial inclusion, international tax cooperation, climate change, financing for sustainable development, capital flows and global debt.
Furthermore, in the discussion related to the financial inclusion agenda, Indonesia welcomed the progress of the G20 Global Partnership for Financial Inclusion (GPFI) in encouraging progress in economic and financial inclusion.
Indonesia conveyed that during the 2022 Indonesian Presidency, BI emphasized three approaches to encourage financial inclusion, comprising increasing access to and use of financial products and services to develop MSMEs and improve public welfare, including through financial literacy and consumer protection.
The other steps include the implementation of macroprudential policies to encourage liquidity in credit distribution coordinated with fiscal policy and the digitalization of payment systems with the support of digital financial infrastructure and cooperation on payment systems between countries.
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Translator: Martha Herlinawati Simanjuntak, Cindy Frishanti Oc
Editor: Azis Kurmala
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