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Govt to take steps in anticipation of economic impact arising from Iran-Israel conflict

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Jakarta, IO – The government is taking a number of steps to respond to the potential impact of the latest conflict in the Middle East after Iran launched a retaliatory attack on Israel, Sunday (14/4).

Many analysts predict that the escalation poses a threat to the already wobbly global economy, and for Indonesia in particular, its macroeconomic stability.

In anticipation, Coordinating Economic Minister Airlangga Hartarto held a limited meeting with all deputies in the ministry and several ambassadors on Monday (15/4).

Airlangga said the impact of these tensions on the Indonesian financial market would be seen at the opening of the capital market this morning, per Kumparan, Tue (16/4).

In addition, he said the conflict can potentially disrupt the supply chain of commodities such as wheat, oil and machinery components from Europe.

Nevertheless, Airlangga said that the Indonesian economy has so far been robust with maintained growth above 5 percent and contained inflation.

“Certainly, the government will not remain idle. We will prepare a number of strategic policies to ensure that the national economy is not further affected,” said Airlangga.

There are a number of policy responses that will be discussed at the meeting related to the performance of the banking sector and capital markets, inflation control, exchange rate and budget deficit.

Read: Jakarta’s Fishing Village Residents Thankful For Prabowo’s Floating Houses Assistance

“The government will continue to closely monitor global and regional developments and will take strong and focused steps to maintain financial system stability,” said Airlangga.

“We hope this will be able to mitigate the impact of the current escalation of geopolitical conflict.”

Relations between Iran and Israel reached a boiling point after Israel attacked Iranian consulate in Damascus, Syria on April 1. This then prompted Iran’s aerial bombardment against Israel as its retaliatory response. (un)

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