VP: Economy cannot be fully left to market mechanisms

The intervention was needed particularly when the market underwent an upheaval that made it unable to perform its function properly, he said.
Yogyakarta (ANTARA News) - Vice President Boediono said the government could not fully leave the economy to market mechanisms and therefore it was intervening where necessary.

"In this modern era, the economy is the market. But the economy cannot be fully left to market mechanisms and government intervention is still needed," he said in his general lecture on alleviating poverty in Indonesia at the Gadjah Mada University (UGM) campus here on Monday.

The intervention was needed particularly when the market underwent an upheaval that made it unable to perform its function properly, he said.

He said the intervention was aimed not only at creating added value to the market but also at achieving the target of developing added value to raise the people`s living standards.

The government had been developing four clusters as part of intervention in the market with the aim of eradicating poverty.

The first cluster targeted households among others through a social health guarantee scheme or scholarships, he said.

The second cluster was directed towards empowering the people`s economy among others through the National Program for Community Empowerment (PNPM) scheme, he said.

Meanwhile, the third cluster was aimed at achieving the goal of developing micro small and medium enterprises and the fourth cluster was based on development programs, such as development of rural areas and slums.

"Right now many elements of the community have given inputs related to the steps that must be taken to control poverty," he said.

Boediono said the government had set itself the target of lowering poverty rate to 8-10 percent in 2014 from the current 12.49 percent.(*)

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