The Indonesian officials have said the possible failure of the U.S. bailout bill may not pose a threat to Indonesia's economic fundamentals, Antara news agency quoted Indonesia government officials as reporting on Friday.
Government officials here have said that strong banking performance, robust commodity exports and less developed capital market products are key reasons for optimism in keeping the country's economic pillars sturdier than in the days of the late 1997 Asian financial crisis.
Indonesian vice president Jusuf Kalla said on Wednesday that Indonesia could well absorb the impact of the U.S. woes on the back of strong exports of commodities in high global demand, regardless of any shakeup in the global economy.
"Regardless of the degree of the crisis in the U.S., the world still needs oil, coal, textiles and palm oil," Kalla was quoted as saying by Antara news agency.
Indonesian Finance Minister Sri Mulyani Indrawati also echoed Kalla's optimism, saying the country's banking sector was in a healthier state than it was prior to the Asian financial crisis.
"Economic growth, as well as monetary and banking stability are relatively stronger since our recovery (from the crisis)," she said.
Key indicators in Indonesian domestic banking sector showed, as of the first half of this year, accumulated gross nonperforming loans (NPL) of domestic banks stood at 4.1 percent, or around 5.28billion U.S. dollars, compared to 4.6 percent at the end of last year.
The central bank requires an NPL for banks of below 5 percent.
The capital adequacy ratio (CAR) of local banks stands at 16.4 percent as of June, much higher than the minimum limit of 8 percent. CAR is the capacity of a bank in terms of meeting liabilities and risks, such as credit and operational risks.
Raden Pardede, chairman of the Indonesian Financial System Stability Forum, said the financial turmoil would not extend far into the Indonesian financial system because of the relative unavailability of complicated securities products in Indonesia.
Source:Xinhua
|
Comment
Tell A Friend
Print Format
Save Article