TUGAS SOFTSKILL 3 : ECONOMIC SYSTEM OF INDONESIA & ADJECTIVE CLAUSE

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1. ECONOMIC SYSTEM OF INDONESIA

The Indonesian Economy since the Old Order to the Present

v Economic System of the Old Order

1 . President Ir . Soekarno


The Period of Post-Independence (1945-1950)
Indonesia does not have an economic system because there are still influences Dutch still want power . Economic situation is very bad at the beginning of independence , partly due to the very high inflation , because the circulation of more than one currency uncontrollably .
Efforts are being made to overcome the economic difficulties , among others :
a) . National Loan Program , finance minister Ir . Surachman with the approval of BP - KNIP make loans to other countries in July 1946 .
b ) . Attempt to break the blockade by diplomatic rice to India , made ​​contact with the American private enterprise , and blockade the Dutch in Sumatra, with the aim to Singapore and Malaysia .
c ) . Economic Conference in February 1946 with the aim of obtaining an agreement on tackling the problem - urgent economic problems , namely : the problem of food production and distribution .
d ) . Establishment of Planning Board ( Board Designer of Economics ) on January 19, 1947
e ) . Reconstruction and Rationalization of the Armed Forces ( Rera ) in 1948 by diverting individual former army into productive fields .
f ) . Kasimo Plan is essentially about self-sufficiency efforts by some practical guidelines . With self-sufficiency , it is expected the economy will improve.

·        The Period of Liberal Democracy (1950-1957)

Political systems and economic systems Indonesian uses the principle - liberal principles . Left to the market economy , in fact indigenous entrepreneurs are still weak and can not compete with non - native entrepreneurs . In the end, this system only worsen the economic condition of the newly independent Indonesia .

Efforts are being made to overcome the current economic problems , among others :
a ) . Syarifuddin scissors , which cuts the value of the currency ( sanering ) to reduce the amount of money in circulation in order to level the price drops .
b ) . Programs Fortress ( Natsir Cabinet ) , which is an effort to foster the spirit of entrepreneurship and encourage indigenous entrepreneurs nationwide importers to compete with foreign imports company . However, this attempt failed because of the nature of indigenous entrepreneurs who tend to be consumptive and can not compete with non - native entrepreneurs .
c ) . Nationalization De Javasche Bank to Bank Indonesia on December 15, 1951 through Act no.24 th 1951 as a function of the central bank and the bank circulation .
d ) . Ali - Baba economic system ( cabinet of Ali Sastroamijoyo I) , ie raising cooperation between indigenous Chinese entrepreneurs and businessmen . Employers are required to provide a non - native exercises to indigenous entrepreneurs .
e ) . Unilateral cancellation of the results of the KMB , including the dissolution of the Netherlands-Indonesian Union . As a result, many Dutch businessman who sold his company while entrepreneurs - indigenous entrepreneurs have not been able to take over the company - the company .

The Period of Guided Democracy (1959-1967)

As a result of the Presidential Decree of July 5, 1959 , Indonesia runs guided democracy system and the structure of the Indonesian economy leads to etatisme system ( everything is regulated by the government ) . Indonesia is expected to bring together in prosperity and equality in the social , political , and economic ( School of Socialism ) . However , the economic policies taken by the government in the past has not been able to improve the state of the Indonesian economy .

Policy - the policy include:
a) . Devaluation : on August 25, 1959 the government reduced the value of money as follows : bills Rp 500 to Rp 50.00 ; USD 1000.00 bill to Rp 100.00 ; and all bank deposits of more than $ 25,000.00 frozen .
b ) . Declaration of the Establishment of Economics ( Economic Declaration ) to reach the stage of socialist economy by means of guided Indonesia . In practice it resulted in the stagnation of the Indonesian economy . Even at 1961-1962 prices of goods - goods rose 400 % .
c ) . Devaluation : on December 13, 1965 the government makes money worth USD 1.000,00 to Rp 1.00 so the new Euro currency should be rewarded 1000 fold Rupiah long , but in a new community Rupiah appreciated 10 -fold higher . Government action to reduce the inflation rate actually increases the rate of inflation .
Failure to various monetary measures is compounded because the government does not save money - spending , many projects - lighthouse project of the government , and also as a result of a policy of confrontation with Malaysia and Western countries .

v Economic System of the New Order

The period of the Transitional Government

2 . President Soeharto


At the beginning of the new order , when Soeharto was president of Indonesia SSAT served this economic conditions in Indonesia is very bad , the level of inflation in our country reached 650 % per year .
          President Soeharto saai it adds a step that has been done previously by Soekarno and turns Soeharto succeed in reducing inflation from 650 % to below 15 % in less than two tender . for inflation meneka so tinngi , Suharto did much different from previous presidents , he embuat budget , issuing penbankan sector , restore economic sectors and embrace country - western neraga to attract capital .
          In addition Suharto in the 1970s also boost oil extraction and mining . Thus increasing revenues from oil and gas . From 0.6 % billion in 1973 and now reaches 10.6 % billion in 1980 . Climax of the policy is ketiaka income from oil and gas equal to 80 % of the Indonesian export . With this policy , Indonesia can advance in development under the new order .

v Economic System of Reform Order

3. President BJ Habibie (May 21, 1998-20 Oktober 1999)


The period was marked by the start of the Habibie government cooperation with the International Monetary Fund to help in the economic recovery process . In addition , Habibie also loosen control on the media and freedom of expression . At the time of presdiden BJ Habibie, who started the reform period have not made changes significant in economics . Preferred policies to stabilize the political situation in Indonesia . President BJ Habibie fall of his government for release of Timor - Timor from Indonesian region polled .

4. President KH Abdurrahman Wahid (October 20, 1999-23 July 2001 )


During the leadership of president Abdurrahman Wahid has been no significant action to rescue the Indonesian economy from the downturn when there are economic problems inherited new order must be faced , for example : the problem of corruption ( Corruption , Collusion and Nepotism ) , economic recovery , the performance of SOEs , inflation control , and maintaining the exchange rate . Occurs and there is much confusion about future policy perekonomian.Pada Wahid , Indonesia 's credit rating has fluctuated , from CCC ratings fell to DDD and then climbed back to the CCC . One of the main causes is the impact of the financial crisis in 1998 that still brought up his government .

Reign of Mutual Aid

5.President Megawati Sukarnoputri (23 July 2001-20 October 2004)


The leadership of Megawati experiencing urgent problems to be solved , namely economic recovery and law enforcement . The policies adopted for handling his economic problems , among others :
a ) . Requesting postponement of debt repayment of U.S. $ 5.8 billion in Paris Club meetings 3rd and allocate foreign debt amounting to Rp 116.3 trillion
b ) . Privatization policy . Privatization is selling companies in the country in the period of crisis with the aim of protecting the company's state of political forces intervene and reduce the burden on the state . Proceeds successfully raised Indonesia's economic growth to 4.1 % . However, this policy sparked a lot of controversy , because SOEs are privatized sold to foreign companies . Megawati intend to take the middle ground by selling some state assets to pay the foreign debt . However , the national debt ballooned anyway because state revenues from a variety of assets have been lost and state revenues to be greatly reduced .

·        Reign Indonesia Unite

6. Susilo Bambang Yudhoyono ( October 20, 2004 - present )


In this period , the government, especially through Bank Indonesia established four policies to boost national economic growth , namely :
a ) . BI rate
b ) . The exchange rate
c ) . monetary operations
d ) . Macroprudential policies for the management of liquidity and macroprudential capital flows

With the above economic policies , the government is expected to increase the country's economic growth will also affect the growing prosperity of the Indonesian people .
Yudhoyono 's first controversial policy is to cut fuel subsidies , which raise the price of fuel . This is motivated by the rise in world oil prices . Budget subsidies diverted to subsidize the education and health sectors and fields - fields that support the improvement of people's welfare .
The second controversial policy , direct cash assistance ( BLT ) for the poor . Most BLT did not get into the hands of eligible and divisions create many social problems , such as noisy when the queue is even led to the loss of someone's life .

Another policy adopted to increase the per capita income is relying on the development of bulk infrastructure to encourage economic growth as well as inviting foreign investors with the promise of improving the investment climate .

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