Apr 06 01:20
RI foreign exchange reserves reach record high of US$41.1 billion


Jakarta (Antara News) - Indonesia`s foreign exchange reserves during the first three months this year reached US$41.1 billion, a figure never recorded before, Bank Indonesia (BI) Governor Burhanuddin Abdullah said.

"This is the highest figure ever recorded since the founding of the republic of Indonesia," Abdulah said here on Wednesday when presenting the bank`s first quarter evaluation.

The coutry`s payment account performance in the period also improved as reflected by a higher surplus in its current as well as capital account, he said.

He, however, warned that the surplus in the payment account had to be continuously monitored considering that the surplus in the current account was more the result of a slowdown in non-oil imports especially imports of raw materials needed to support Indonesia`s exports so far which could affect export performance in the next period.

He said short-term capital inflow which was sensitive to sentiment and therefore had a high risk of outflowing still dominated capital account structure.

The rupiah exchange appreciated significantly at an average Rp9.299 against the US dollar or by 6.9 % in the fourth quarter of 2005, he said.

The appreciation of the rupiah was the result of international capital inflow and a decline in foreign exchange demand due to slow domestic economic actitivities.

"In short term, efforts to manage investors` perception in the financial market become significant to prevent possible sudden capital outflow," he said.

The governor said to support payment account performance improvement of fundamental factors had to be made, namely making exports more competitive and investment climate attractive to attract foreign direct invesment. (*)
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