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|22 March 2010
Indonesian economy facing investment challenges
The most important challenge Indonesia is facing now in its efforts to improve its economy and generate its economic growth is how to increase investment, national news agency Antara quoted Citigrup economist Johanna Chua as saying.
"The main challenge to Indonesia`s economic developments in 2010 is how to increase investment growth," Johana Chua said in a seminar on the 10th Annual City Indonesia Economic and Political Outlook 2010.
Johanna said that investment growth in 2009 was too low so that its contribution to national economy was also too small. "Investment growth in 2009 was very low, only about three percent. It should be improved in 2010," the economist said.
She said the government needed to pay attention to the investment activities in the country and issue supporting monetary polices so that investment could be more generated.
Based on survey, in term of foreign direct investment, Indonesia is the 15th most attractive nation for would-be investors. "Cost of workers, availability of resources and regulation issues are factors that put Indonesia in the 15th position," Johanna said.
However, she expressed optimism that Indonesia’s economy would improve in 2010 and become better than that in 2009.
"One thing that needs to be watched is the upward trend of inflation which would happen in line with improving economic conditions. Also, the government should manage well bonds which are in the hands of foreign investors, particularly when advanced nations adopt an exit policy strategy," she said.
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