JAKARTA - President Joko Widodo (Jokowi) on Monday described the current direction of the global economy as difficult to predict and asked central and regional officials to remain alert, reported ANTARA news agency.
"I often say that the world is now increasingly unclear, global economic uncertainty is difficult to calculate," Widodo said during a briefing with regional heads from across Indonesia at the State Palace in Jakarta.
The current global monetary policy is difficult to predict, he added. There are indications that only the United States Federal Reserve (Fed) has raised interest rates, but the adjustment from the most influential central bank in the world has caused problems for all developing countries due to a reversal in capital flow.
Another thing that has caused uncertainty is climate change, which has also had an impact on food production, Widodo said.
In the past, he continued, the impact of climate change was often underestimated. However, now, it has caused drought, which could ultimately reduce crop production.
As a result of climate change, Indonesia needs to import food to cover production shortfalls. However, applying for imports to various producing countries is currently not easy because the whole world is facing the threat of a food crisis.
"Secondly, climate change, (for) which (they) used to say 'ah, this is something unseen', is now clearly visible. Drought in seven provinces and several countries has reduced our rice production. We want to stop importing now and it's not as easy as before to find imported rice," he highlighted.
Widodo informed that he had spoken with Indian Prime Minister Narendra Modi about obtaining a rice import quota. However, this could not be achieved because India is also exporting just enough to secure the country's national stock.
"But he (PM Modi) uses it himself as a backup, he doesn't dare to let it go. I've said he doesn't dare to let it go," the President said.
Southeast Asian countries, which previously offered rice for exports, such as Thailand and Vietnam, are also now limiting shipments, he added.
Widodo emphasised that global economic dynamics like these must be understood by all regional heads. Regional leaders must be aware of this global uncertainty's impact on the local economy.
"Situations like this, ladies and gentlemen, is something that we must know, so that when working, 'I have to come here to understand.' What does it mean if fuel prices increase? Inflation will rise. Rising inflation means that the prices of goods and services will also increase accordingly. We alone have seven provinces affected by Super El Nino, production has fallen, this is what everyone must be alert to," he said.
Minister of Finance, Sri Mulyani Indrawati, and Minister of Home Affairs, Tito Karnavian, were also present at the President's briefing. - BERNAMA