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The government sees economic growth of 6.8 percent in 2008,
with inflation between 5.6 and 6 percent, the coordinating minister for
the economy said Monday.
Boediono was addressing the Indonesian Chamber of Commerce and Industry
(Kadin)'s annual meeting, being held at the Jakarta Convention Center.
The growth target for this year has been set at 6.3 percent, although
Finance Minister Sri Mulyani Indrawati has said growth may not reach
the 6 percent mark due to declining investment last year. She expects
economic growth of 6.6 percent in 2008.
Boediono said the economy has improved since the second and third
quarters of last year, and the government had put into place policies
to further push the economy.
With more relaxed monetary policies, effective fiscal management and an
improved investment climate, he said the growth target could be
achieved.
"We have to be optimistic. There's no reason to be pessimistic," he
said.
The central bank has cut its key rate 10 times since May last year in
the hope of making the cost of lending more affordable, which could
then spark a revival in the real sector. It also recently issued
regulations aimed at helping small businesses secure loans.
Boediono said the government would improve its fiscal policy by
focusing spending on growth and poverty reduction.
"We will maximize budget spending to spur economic growth, reduce
poverty and create more jobs.
"In 2007 and 2008, the government, in its macroeconomic projections,
will continue to improve the investment climate by improving
regulations," he said.
The government, Boediono said, will also try to improve labor
conditions without having to amend existing regulations, which have
long been seen as inimical to investment.
"I know that the issue has long been politically driven, but
improvement is inevitable as it is crucial to improve the investment
climate," he said.
Meanwhile, Kadin said its goal was to help Indonesia become an advanced
trading and industrial state by 2030, with the support of business
players and the government.
"Kadin will guide this vision until it materializes," the group's vice
chairman, Rachmat Gobel, said after presenting the association's 2030
Economic Vision and Roadmap for National Industry.
The association will cooperate with the government in composing
strategies to achieve its 2030 goal.
"We need commitment, concrete actions and consistent policies from the
government," Rachmat said.
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