President Jokowi Pushes for Greater Role of CFSS Amidst Rapid Global Changes

INDUSTRY.co.id - In a bid to brace for various future scenarios and to quickly respond to any changes caused by the global dynamics, President Joko “Jokowi” Widodo has called for the stronger role of the Committee for Financial System Stability Committee (CFSS).

The CFSS (or Komite Stabilitas Sistem Keuangan in Bahasa Indonesia) is tasked to prevent and tackle financial system crisis and to protect the country’s interests and resilience in the economic sector.

The committee’s membership includes Minister of Finance, Governor of central bank Bank Indonesia, Chairperson of the Board of Commissioners of the Financial Services Authority (FAS), and Chairperson of the Board of Commissioners of the Deposit Insurance Corporation (DIC).

“The most important thing is to be prepared for all future scenarios and to respond quickly to any changes. For example, in the event of inflation, keep monitoring the situation on the ground and resolve any problems quickly. The Government needs to strengthen the role of the CFSS and to meet frequently and speak frequently with FFSC to maintain stability of the financial sector,” said the President during the 2023 Bank Indonesia (BI) Annual Meeting at BI Head Office, Jakarta, Wednesday (11/29).

President Jokowi also ordered the CFSS to improve coordination, especially in an unusual situation like today.

“Amid the situation like this, at least once a week or once every two weeks the CFSS needs to meet to exchange economic figures and calculations to respond quickly to the changing situations,” he said, adding that the world is not in a favorable situation due to crisis in other countries that bring a global repercussion such as inflation and high interest rates in the United States, the slowdown and the property crisis in China, and the escalating geopolitical tensions in the form of wars in Ukraine and Gaza.

“Therefore, together we must brace for the impact of the current war because it will affect everything, such as causing global supply chain disruptions, leading to spikes in food prices and energy prices,” he explained.

The President pointed out that the world is also bearing the brunt of climate change, especially related to food situation in Indonesia, adding that global warming, coupled with restrictions on food exports from 22 countries, has caused decline in the country’s food production.

In the midst of these various challenges, President Jokowi said he is grateful that Indonesia’s economy continues to grow and remains stable at around 5 percent and inflation tends to be stable at around 2.6 percent, while by comparison economic growth in several countries such as Malaysia is 3.3 percent, the US is 2.9 percent, Republic of Korea is 1.4 percent, and the European Union is 0.1 percent.

“What does it mean? It means we have to be optimistic, but still have to stay vigilant. We still have to be careful. We have to be alert to the quick, super-fast changes and technological disruption. We must be prudent in our steps, but not too careful. If we are too careful, the result is bad turnover in the real sector,” he remarked.