As a result of the pandemic, Indonesia has entered its first recession in two decades. (Photo: VNA)The loan is intended to aid Indonesia’s ambitious reformprogramme to attract investment and increase the country’s economiccompetitiveness, said Satu Kahkonen, WB Country Director for Indonesiaand Timor-Leste.
“These reforms have the potential to support an economictransformation away from commodities and towards higher value-added sectors. Thiscould provide a much-needed boost to the post-pandemic economic recovery.”
High barriers to investment and trade have limitedIndonesia's ability to attract export-oriented foreign direct investment, reducedits integration into the global economy, and increased the cost of food in thecountry. These limitations also have slowed the growth of manufacturing andnon-commodity sectors. The lion's share of jobs in the past decades have beencreated in the commodities and low-productivity service sectors, which oftenpay below middle-class wages.
As a result of the pandemic, Indonesia has entered itsfirst recession in two decades. This has exacerbated the challenges the economyis facing in expanding to more sophisticated sectors to help create better-paying,higher-productivity jobs./.
VNA
