Indonesia’s foreign exchange reserves drop from record high as risks loom

first_img“Bank Indonesia considers this enough to support external sector resilience and maintain macroeconomic and financial system stability,” the central bank wrote in a statement.“Going forward, we see the reserves as adequate, supported by a stable and solid domestic economic outlook.”However, risks loom as the country is expected to face heavy foreign outflows in the future, said Bank Mandiri economist Andry Asmoro.Foreign investors sold a net Rp 30.8 trillion (US$2.17 billion) of Indonesian assets through February until Feb. 27, Rp 26.2 trillion of which was in government bonds and Rp 4.1 trillion in stocks. “Risks are coming from weaker global growth,” Andry said. “Stagnated commodity prices and escalating fears over the COVID-19 outbreak will disrupt Indonesia’s exports and tourism and cause higher uncertainty and volatility in the financial market.”The pneumonia-like illness, which was first reported in Wuhan, China, at the end of December 2019, has infected around 95,000 people worldwide and killed more than 3,200, disrupting businesses, factories, schools and office activities around the globe as governments try to contain the virus.President Joko “Jokowi” Widodo announced on Monday the first two confirmed COVID-19 cases in Indonesia, prompting concerted efforts by the government and financial authorities to cushion the country’s economy from a possible hit.However, Andry expressed his optimism that the United States Federal Reserve’s dovish monetary stance coupled with Indonesia’s benign inflation rate in 2020 would make returns of Indonesia’s financial assets remain relatively attractive, encouraging foreign investors to pour their money into the country’s financial system.“We estimate the CAD [current account deficit] in 2020 to widen to 2.88 percent of GDP versus 2.72 percent of GDP in 2019 and the rupiah exchange rate to depreciate to 14,296 per US dollar versus1 3,866 in 2019,” he said.The Fed delivered an emergency half-percentage point interest rate cut to a range of 1 percent and 1.25 percent on Tuesday in a bid to protect the US economy from the spreading coronavirus. BI also cut its benchmark interest rate, the seven-day reverse repo rate, by 25 basis points (bps) to 4.75 percent last month to mitigate the potential risks from a COVID-19 spread on the country’s economic growth.BI Governor Perry Warjiyo said on Wednesday that the central bank saw ample room for monetary and macroprudential easing amid risks posed by the outbreak.He cited room for a lower reserve requirement ratio for both the greenback and rupiah for local banks. He also mentioned the policy rate as a possible easing measure to jack up growth, which he expected to slow down to 4.9 percent in the first quarter, compared with a three-year low of 4.97 percent in the 2019’s fourth quarter.“Going forward, the direction of BI’s monetary stance will continue to be accommodative,” Perry stressed. Topics :center_img Indonesia’s foreign exchange (forex) reserves fell to US$130.4 billion in February after the government paid its foreign debts, Bank Indonesia (BI) announced Friday.Foreign reserves stood at $131.7 billion in January, which was the second-highest level in Indonesia’s history after the $131.9 billion booked in January 2018.February’s figure is enough to support 7.4 months of imports and payments of the government’s short-term debts and is above the international adequacy standards of about three months of imports.last_img read more

Major division between African cultural groups

first_img– as majority vote for scrapping IDPAD-GA major rift between several prominent African groups was put on full display on Sunday when a number of the attendees voted in favour of having the International Decade of People of African Descent-Guyana (IDPAD-G) scrapped, while a handful voted in favour of it restarting from the beginning.The meeting, which was held at the Critchlow Labour College, saw representatives from many African cultural organisations, while some were clearly absent. Among the issues raised were the appointment of IDPAD-G’s Chief Executive Officer Olive Simpson, and the overcrowding of certain groups on the team.African Cultural and Development Association (ACDA) Head, Dr Eric Phillips, who is also Chairman of the Reparations Committee, told the gathering that a majority of the groups under IDPAD-G’s were formed last year. In an attempt to sell the audience on the legitimacy of the group, he said it was done in consultation with others.Certain revelations were made during the meeting, including the fact that IDPAD-GIDPADA-G’s Chairman Vincent Alexanderrented office space at 121 Regent Street, Bourda, Georgetown from Charles Corbin, the brother of former People’s National Congress Reform (PNCR) Leader Robert Corbin.According to Dr Phillips, issues like these need to be ironed out as they would give the Opposition People’s Progressive Party (PPP) reasons to raise concerns about possible conflicts of interest between Corbin and IDPAD-G’s Chairman, Vincent Alexander, who are also both Commissioners of the Guyana Elections Commission.Another point raised by the ACDA official was the fact that there were concerns over the proposed structure and strategy for IDPAD-G touted by the Chairman. Instead, it was recommended that five thematic areas – expiation, economy, education, equality, and employment – be used to craft policies.But, more importantly, the ACDA official said the $68 million that has been allocated to IDPAD-G should be used to create a college of African village leaders. This entity, he said, should be used to discuss the many challenges, but more seriously the fear about the coalition losing the 2020 election. Concerns were also raised about many returning Guyanese being given prominent roles when there was talent here.The meeting, which was chaired by Jonathan Adams, said based on the unanimous decision taken at the meeting, the vote would be submitted to the IDPAD-G management, who would decide on the next course of action. In the meantime, he called on the participants to fix their differences and work together.In March, Guyana hosted the 2018 IDPAD Summit, which brought together more than 60 academics, black activists, and other expert speakers from around the world to focus on eradicating the plight of African descendants through the implementation of possible solutions.The International Decade for People of African Descent (2015-2024) was proclaimed by the United Nations General Assembly in a Resolution (68/237) adopted on December 23, 2013. It was subsequently launched by UN two years later, thus commencing the 2015-2024 decade aimed at highlighting issues relating to Africa and its millions of descendants around the world.Guyana had subsequently established a local arm, the IDPAD-G Committee, which is the only one of its kind in the Region, and has received the support of the Guyana Government.last_img read more