Jakarta – RI President, Joko Widodo previously warned of the domino impact of the collapse of banks in the United States (US), such as Silicon Valley Bank (SVB) and Signature Bank, on Indonesia.
The Indonesian Ministry of Finance has anticipated the impact of the banking sector conditions in the United States (US). The reason is, even though Indonesia does not have a big dependence on the US, the threat of a banking crisis in that country can have an impact on the global economy.
Responding to these conditions, the Dean of the Faculty of Economics and Business, University of Indonesia, Dr. Teguh Dartanto, Ph.D, believes that Indonesia’s financial sector is far more prudent than before.
“Indonesia has gone beyond experience in dealing with various crises. From the 1998 crisis, Indonesian banking was able to rise and be more prudent. The impact of the global crisis in 2008, we can fight and be sufficiently immune,” he concluded.
His party also agreed with Minister of Finance Sri Mulyani’s belief that Indonesia’s condition was quite safe because the experience during the Covid-19 pandemic had an impact on the economic crisis which had proven the ability of the authorities to protect Indonesia from being hit by the crisis.
“One of the best as the Minister of Finance said, during the Covid-19 pandemic, with good policy and good luck both from controlled health issues, sectoral policies, the fiscal sector, the monetary sector, the financial sector, and good coordination between Bank Indonesia, the Ministry of Finance , OJK, and LPS, have been quite good,” said Teguh.
Teguh also appreciated the Ministry of Finance’s performance in maintaining the state’s financial condition so far. Teguh emphasized that the Ministry of Finance had predicted that SVB’s fall would not be as severe as bank bankruptcy during the 2008 financial crisis because SVB’s portfolio linkages with the Indonesian financial sector were limited.
In line with Teguh’s view, Chairman of the Supervision Board of Bank Indonesia, Muhammad Edhie Purnawan, stated that Indonesia is trusted enough so it will be safer.
“Banking conditions in Indonesia are safer. However, what needs to be considered are companies or start-ups whose funding is linked to funding from the US,” said Edhie.
Edhie stressed that banks in Indonesia need not worry. Because so far what has been affected is the US and European composite indices, while the effect for Indonesia is market sentiment in the JCI.
“Banks in Indonesia are relatively safe, so people don’t need to worry because they don’t have a big impact,” explained the Lecturer at the Faculty of Economics and Business, Gadjah Mada University.
