Kedutaan Besar Republik Indonesia
Ottawa
Embassy of the Republic of Indonesia
Ambassade de la RÉpublique d'Indonésie

Bank Indonesia Targets Current Account Deficit of between 0.25% – 2.5%

Bank Indonesia (BI) has targeted for Indonesia’s current account deficit to stand at a sustainable level or between 0.25 percent and 2.5 percent of Gross Domestic Product (GDP) in line with the latest economic situation.

“What we want to say is, this should not have to be a surplus — because an economy can sometimes have a ‘hard landing’ – but a deficit with a ‘sustainable’ figure, which is in a range of between 0.25 percent and 2.5 percent,” said BI Governor Agus Martowardojo in Jakarta on Wednesday as quoted by Antara news agency.

Agus said Indonesia’s current account deficit had declined to US$8.4 billion or 3.8 percent of GDP in the third quarter of this year from $9.9 billion or 4.4 percent in the previous quarter.

However, he said, there should be more efforts to push down current account balance that had suffered a deficit for 26 months so that Indonesia could be a step ahead and slip away from middle income traps.

“Indonesia has the potential to become an ‘upper middle income’ country due to its middle income class that has continued to expand, its various demands, and its complex structure. If it is not addressed, we will fall into ‘middle income trap’ and suffer a delay in becoming an upper middle income country,” said Agus. (ebf)

Source : www.thejakartapost.com, 27 November 2013