The challenges
The arrow has left the bow. Now is the time to break the pots and burn the boats.
The Indonesian Government must realize that de-dollarization is more than a simple financial risk management adjustment. It is plainly a global geopolitical step, one with large political, economic and legal ramifications, likely affecting trusting international relations.
With its open economic system, Indonesia must be aware just how its economic performance is swayed by other countries’ policies, both directly and indirectly.
Still fresh in our minds is how the alarming “American First” policy or President Donald Trump set off a trade war between the US and China, adversely affecting the world economy, including Indonesian trade.
Indonesia must brace itself for its products suddenly being banned from the global market, with a litany of the usual absurd excuses: environmental issues, antidumping policies, employment and gender issues and a host of others not directly related to production and trading.
Once the tit-for-tat heats up, countries may even impose both tariff and non-tariff barriers, to put the squeeze on products from Indonesia.
Read: Rebranding Indonesia’s Bioenergy: A Call For A Just Energy Transition Partnership
Businesses expect to the Government and Bank Indonesia, as supreme monetary policy authorities, to mitigate risks and ameliorate challenges of de-dollarization.
The hope is that a quiet and dignified de-dollarization will not turn out to be a reckless gamble offering chancy returns the Government and Bank Indonesia have the sober responsibility to anticipate challenges and prepare strategies to face them if the ongoing war against US hegemony really heats up.