According to Boediono, it is the positive and negative impact of the trade war for the Republic of Indonesia

JAKARTA, KOMPAS.com – The trade war between the United States and China is expected to continue even though the two defenders will meet at the G20 summit in Buenos Aires, Argentina this week.

In response to this, Eleventh Vice President Boediono said that the trade war between these two giant economies would have a positive and negative impact on the Indonesian economy.

According to him, exports, which are one of the engines of Indonesian economic growth, should decrease. Because the United States and China are the two leading export countries of Indonesia.

With the introduction of import duties by the United States and China on several export products from each country, it is possible for goods-producing countries to be granted their rights. import to search for new markets, including to Indonesia.

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"The countries producing these products that could enter the United States or countries accustomed to buying, because of price and other signs, are looking for new markets so that these attacks are prepared for us," said Boediono at the KataData forum in Jakarta. On Wednesday (28/11/2018).

However, it is possible that a trade war has a positive impact on Indonesia. Because, with the promulgation of the import tariff, this will reduce the production costs of products made in China.

We can therefore expect investment flows to reach countries considered safe, as in Indonesia.

"But there is something positive: suppose China can not produce or its factories can not produce because made in China this investment can move to Indonesia. I hope that there is", explained the former governor of the Bank of Indonesia (BI).

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Boediono also explained that the trade war that broke out between the global economy was indeed vulnerable to the crisis. Because the global economy adheres to a market economy system or capitalism characterized by uncoordinated 19th century signs.

Unlike the national economy with the government and clear signs. According to Boediono, no one can be really responsible for what happens to the global economy.

"It is therefore subject to crises if our national economy has institutions capable of well-coordinated macroeconomic, fiscal and monetary policies, structural reform and so on, this can reduce the risk of instability and crisis in an economy. There is no global presence, no one is responsible for the development of the crisis, all are confused, nothing can be coordinated, "he said.