Jakarta –
United States (US) has followed a series of other countries to the brink recession. The superpower was declared recession after its economy in the second quarter of 2020 -32.9% and previously in the first quarter of 2020 -5%.
Unlike previous countries, the US economy’s recess is believed to have a significant impact on Indonesia.
Economic Researcher for the Institute for Development of Economics and Finance (Indef) Bhima Yudhistira explained the impact of the US economic recession will be quite felt for the national economy. According to his calculations every 1% of corrected US economic growth will affect 0.02-0.05% of Indonesia’s economic growth.
“The effects of the US recession will also have an impact on investor confidence in investing in high-risk assets such as stocks. Changes in investor behavior are increasingly targeting safe havens such as gold and government bonds,” he explained detikcom, Sunday (2/8/2020).
That way, there will be an outflow of foreign capital from the Indonesian capital market. Another effect is the decline in export performance to the US as a major trading partner.
“Recession “in the US, the purchasing power of consumers is decreasing, and automatic export demand such as commodities, textiles, apparel, processed wood and footwear has fallen, especially in the second half of 2020,” Bhima added.
Economist at the Center of Reform on Economics (CORE) Yusuf Rendy Manilet added, the US recession is not like the recession of Hong Kong, South Korea, Singapore and other countries. The US economic recession will have a significant impact on Indonesian trade.
“The US recession needs to be watched out because the US is Indonesia’s biggest trading partner after China. Indonesia’s export share to the US is 10%. When viewed from products, 50% of Indonesia’s footwear and textile exports are also sent to the US,” he explained.
While Textile products and Textile Products (TPT) is one of Indonesia’s leading export products. This means that the US recession will potentially depress Indonesia’s export performance this year.
Research Director of the Center for Reform on Economics (CORE) of Indonesia, Piter Abdullah explained, from a series of recession-affected countries mostly affected by falling exports. But according to him it will not have a significant impact for Indonesia because the economic wheels are not too dependent on exports.
“So the recession in the US And in many other countries will not make the Indonesian economy worse. We have felt the impact of the recession in various countries including the US where our exports have declined. It will not have a greater impact. Our economy has contracted, especially because of the plague which causes our consumption and investment to decline, “he said.
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(das / dna)
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