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G20 Indonesia Brings The Double Effect For the Indonesian Economy

Sabtu, 19 November 2022 - 01:35 | 63.44k
President Joko Widodo in the G20 Presidency. (PHOTO: AJP TIMES Indonesia)
President Joko Widodo in the G20 Presidency. (PHOTO: AJP TIMES Indonesia)

TIMESINDONESIA, BALI – The successful of the G20 Indonesia Presidency is estimated to have a good effect on the national economy. Especially Bali area, the center of the G20 event. 
"It is predicted that it will be positive for the performance of the national economy. The transmission is from the tourism sector, such as trade, transportation, food and beverages, MICE, hospitality, and services," said INDEF Economist, M. Rizal Taufikurahman, on Thursday (11/17/2022).  

Furthermore, Rizal estimates that the multiplier effect for the Indonesian economy will reach around Rp6.6 trillion, smaller than the government's calculation of  Rp7.4 trillion. 

"There is a Direct and Indirect Effect. Direct effects such as spending on foreign tourists such as hotel / MICE shopping, food and beverages, clothing, MSMEs, and others. Meanwhile, the Indirect effect has an impact on economic performance. Particularly  the tourism sector, such as the food and beverage processing industry  sector, trade,  air, sea, and land transportation, hospitality,    and  other services ( laundry services,  entertainment, and others,)" added Rizal.

In addition to the tourism sector, the G20 commitment will encourage trade, especially exports.

At the G20 Summit Indonesia also received several investment commitments and grants, all the more in the field of energy transition.

U.S President Joe Biden who sat down with Coordinating Minister for Economic Affairs Airlangga Hartarto announced, the U.S Government officially announced new project on PGII’s, including Indonesia Just Energy Transition Partnership (JETP) which mobilizes USD 20 billion in public and private sectors financing for Indonesia, the Indonesia Millennium Challenge Corporation (MCC) Compact which has successfully launched USD 698 million. 

Coordinating Minister for the Economy Airlangga himself plays an essential role in the G20.  He expressed gratitude when the G20 Presidency ended successfully.
"I am grateful and touched, with all the dynamics, tough negotiations, and hard work for one year has paid off," said the Coordinating Minister Airlangga.  

The man who also serves as chairman of the Golkar Party hopes that all the agreements that occur at the G20 will benefit not only Indonesia as well as other countries in the world. 

Meantime, Executive Director of the Center for Strategic and International Studies (CSIS) Yose Rizal Damuri assessed that the G20 brings benefits not only to the global economy moreover to the Indonesian people.

According to him, global economic conditions, inevitably, must affect the domestic economy. 

G20 brings optimism to the Indonesian economy with several commitments or agreements that directly refer to Indonesia. One of them is Indonesia Just Energy Transition Partnership (JETP) project which mobilizes US$20 billion in public and private sector financing for Indonesia.

"Of course, we see that there are several projects or agreements that are specifically for Indonesia.   For example, the JETP, which was promoted by the G7 yesterday, was announced by Joe Biden. JETP is for developing countries, however the first specific one is given in Indonesia. USD 20 billion, that's his commitment to the energy transition," he said.

For information, JETP is a new project of the Partnership for Global Infrastructure and Investment (PGII) that is a collaborative effort of G7 members (United States, United Kingdom, Italy, Japan, Germany, Canada, and France). PGII has a commitment over the next 5 years to invest US$600 billion in loans and grants for sustainable infrastructure projects for developing countries.

Yose emphasized that the G20 brings benefits and fosters optimism in the Indonesian economy with the commitments and agreements produced in the G20. Nevertheless, Indonesia still has to pursue the realization of the committee.

"Once more, there's something that's brought in concretely there, although it's still a commitment.   It should be followed up, hence that the commitment is realized," Yose commenting for JETP project which was stated by Joe Biden during the G20 Indonesia .

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