President Confident per Capita Income Increase by 15 Percent
Friday, 03 November, 2006 | 11:32 WIB

Tempo Interactive, Jakarta: President Susilo Bambang Yudhoyono was positive that national per capita income can reach US$1,500 or around Rp13.6 million by the end of the year. The amount increases 15.4 percent, compared to last year at US$1,300 or around Rp11.8 million.

The US$1,500, according to Yudhoyono, will be realized if the government can maintain the inflation rate at under 7 percent with economic growth of 5.6 percent. “In general, Indonesian economics has improved. I am optimistic that this will continue if economic stability is maintained,” said the President in the Indonesian Regional Investment Forum yesterday (11/2) in Jakarta.

He said that other economic indicators have also signaled an increase. Among them are a 19 percent increase of trade balance to US$4 billion or around Rp36.4 trillion compared to last year. In addition, the improved index of Indonesian stock exchange was one of the top three in Asia below India and China this year.

In order to increase the income per capita as targeted, the President emphasized the prioritized sectors to be developed: investment, real sector growth that may add to job opportunities as well as village and agricultural development. “Regions have large enough potentials to develop,” he told investors.

According to Iman Sugema, economic analyst from the Awaken Indonesia team, the increase of national income per capita in 2006 was not uncommon. On the contrary, 15.4 percent increase was too slow from what could be achieved. “If there were no crisis, the amount would have been reached. So, this is somewhat late,” he said.

Iman added that the government should not set a fixed amount on this year's per capita income. The reason is that many factors will affect the amount: the fluctuated rupiah exchange rate against the US dollar would be one of them.

The mounting national income per capita, said Iman, will not have a significant effect if it is not followed by the decrease of the poverty rate. In addition, the number of poor people this year has increased to 18 percent—last year 16 percent. “So, if the US$1,500 is reached, do not over-interpret it. The reason is that, we must remember, the poverty rate is still high,” he said.

An economist at the University of Indonesia, Chatib Basri, viewed that national per capita income of US$1,500 can be achieved this year as long as the government keeps focusing on investment growth, which up to now, is not significant.


Edited by KuKuKaChu (04 Nov 06 03:40)
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