Global Economic Growth

Indonesia as a small open economy in the global economy are very easily influenced by international economic developments, both positive and negative. Effect of contagious and spill over from abroad to easily hit the national economy. Looking ahead, the authorities needed the ability to design economic policies of the toughest and not easily swayed by the waves of the world economy. Recent experience shows that Indonesia's economy is very vulnerable to the negative impact of international developments. Whereas international economic developments can be said is still not friendly. U.S. central bank (the Fed) is still projected to raise interest rates. Similarly, the downward trend of oil prices in international markets also seem not continue as we expect. And, therefore, high oil prices are still going to be a part of our lives. Meanwhile, global economic growth in general is still low and stagnant.

Projection of the International Monetary Fund (IMF) in September 2005 World Economic Outlook shows that the overall world economy to grow slower this year.

The world economy in 2005 grew by 3.5%, but this year estimated that only 3.3%. While Japan's economic growth rate this year is expected to stagnate at the level of 2% as in 2005. Thus, difficult to expect a large increase of our exports. Global economic developments less profitable indeed have contributed to the deterioration of the Indonesian economy. But still the main problem is the inability of our economic team to anticipate and formulate good policies, so that deterioration which occurs increasingly widespread.

The government itself saw this dangerous trend. Therefore, President Susilo Bambang Yudhoyono is limited to the United Indonesia Cabinet reshuffle in the economic field, some time ago.

The presence of a new economic team was high time to give hope. Money and capital markets responded positively to their presence. But the market also saw that the new economic team in his cabinet did not immediately able to solve problems and challenges. This we can see today. Partly because the challenges and problems facing the Indonesian economy is still heavy. Various deterioration that occurred is still the economic balance of this year, and it is not easy to overcome. Moreover, state finances are still too heavy because of the large debt burden borne by the government.