The World Bank is urging countries, including Indonesia, to take a clear and sustainable approach to economic growth. This is particularly important in the face of limited fiscal and monetary capacity due to global uncertainty. Manuela Ferro, Vice President of the World Bank East Asia and Pacific, emphasized the importance of addressing policy uncertainty, especially with multiple countries experiencing leadership changes this year. She urged new administrations to promptly communicate policy directions to households and companies to provide clarity and certainty.
Ferro also highlighted the importance of creating a competitive investment regime that would attract more investors into economic activity. With more than half of the world’s population voting this year, several Asian countries, including Indonesia, have already held elections. Indonesia’s General Elections Commission recently announced Prabowo Subianto as the winner, set to be sworn in as the new Defense Minister in October, along with his running mate Gibran Rakabuming Raka, President Joko “Jokowi” Widodo’s eldest son.
The International Monetary Fund (IMF) issued a warning in a report last October regarding the need for countries to address growing fiscal risks, such as tight financing conditions and rising concerns about debt vulnerabilities. Ensuring policy clarity and certainty for businesses is critical for sustainable economic growth, especially as countries navigate global uncertainty and leadership changes.
