Indonesia’s Covid-19 Surge Can Potentially Undermine Economy

JAKARTA, KOMPAS.com – Indonesian Finance Minister Sri Mulyani Indrawati has expressed her concerns that the increasing number of Covid-19 cases in Indonesia will adversely affect economic growth in the second quarter of 2021.

“The rise in Covid-19 cases hampers the mobility and public consumerism needed for economic growth in the second quarter, which we have set for 8.3 percent,” said the former World Bank Group Managing Director.

Speaking at a hearing with parliament’s Commission XI on economic issues Monday, she observed that “we should beware of this surge in [Covid-19 cases] this June, as it is the final month of the second quarter of 2021.”

Also read: Finance Minister Forecasts Indonesia's Economic Growth at 8.3 Percent in Q2 Due to Seasonal Factors

Sri Mulyani pointed out that the hike in Covid-19 cases is reflected in rising coronavirus numbers on provinces in Java, such as Jakarta, Central Java, East Java, and West Java following the Eid al-Fitr or Idul Fitri holidays.

“The increase in Covid-19 cases in Jakarta in the bed occupancy ratio [BOR] at the Covid-19 Emergency Hospital in Wisma Atlet. The BOR increased from 16 percent, 29 percent then 33 percent, before reaching its current level of 80 percent,” she added.

Prior to Idul Fitri, the surge was seen in provinces outside Java such as Aceh, the Riau Islands or West Sumatra on Sumatra island, as well as South Sulawesi and West Kalimantan.

Sri Mulyani asserted that the pandemic also affected the global economy in general, and Southeast Asia in particular. “Neighboring [ASEAN] countries such as Malaysia, Singapore Thailand and Vietnam are also experiencing an uptick in daily Covid-19 cases,” she asserted.

Also read: Indonesian Minister of Finance Suggests 1 Million Daily Vaccinations to Jumpstart Economy

“The surge will leave a chain reaction that affect ASEAN countries as well as developing countries like Indonesia, which is dependent on the state of the global economy.”

Sri Mulyani has set Indonesian economic growth for the second quarter of 2021 at between 7.1 to 8.3 percent, despite a 0.74 percent contraction in the first quarter of the year.

She also suggested increasing the rate of Covid-19 vaccinations by more than three times to one million people a day to reach herd immunity and jumpstart the economy.

(Writer: Fika Nurul Ulya | Editor : Bambang P. Jatmiko)

Source: 

https://money.kompas.com/read/2021/06/14/193500326/sri-mulyani-was-was-naiknya-kasus-covid-19-bisa-bikin-ekonomi-ri-jeblok-lagi.