President Susilo Bambang Yudhoyono called on Monday for a closer partnership between governments and the business community to stimulate the global economy during the lingering economic crisis still gripping many nations.
"We in government, no matter how hard we try, cannot possibly achieve global economic recovery by ourselves. Our partnership with the business community is a must – it is no longer a choice," Yudhoyono told the B20, a summit of global corporate leaders, at the margin of this week's G20 meeting in Los Cabos, Mexico.
He said the meeting was being held at a time of uncertainty in the global economy, especially as the mood of many nations is tinged with pessimism. He cited growth projections by various international financial institutions that continued to show slowing global economic growth.
"Let us join hands and seize every opportunity for creating wealth for ourselves and for future generations. Let us coordinate our efforts to stimulate the global economy. And let us work together to create employment that is highly needed by peoples all over the world," Yudhoyono said in the speech, a copy of which was obtained by the Jakarta Globe.
Yudhoyono reminded the world that opportunities were particularly abundant in emerging economies, and encouraged everyone to realize that growth potential. "Indeed, overall, the emerging economies have done reasonably well in recent years, maintaining some degree of resilience that was helpful to the global economy," he said.
He also pointed out that there was an interesting trend among emerging economies – the rise of diplomatic, economic, corporate confidence, for example.
"This confidence is a precious thing, but like any other psychological phenomenon, it is not permanent. Emerging economies must not take this rare surge of confidence for granted, and just as we earned its coming, we must also earn to keep it going as long as possible in the years ahead," he said.
Yudhoyono said the world was now facing problems that were increasingly complex and interlinked, and which offered no easy solutions or short cuts.
"In the face of growing uncertainty and tougher times, governments and businesses need to work even closer together. This is no time for divergence and mistrust," Yudhoyono urged. He said that countries and businesses also needed to pool resources. He said the business community had the capacity to anticipate problems arising from government policies from a practical point of view, while governments have the authority to devise policies and strategies that affect businesses and general public.
"We must pursue joint advocacy in order to achieve greater impact," he said, adding that it was important for our people to be informed what their government is doing at the G20 and what businesses are doing in the B20 so as to gain the public's confidence and support.
Speaking for Indonesia, Yudhoyono said that with a more resilient economy, its growth was estimated to reach 6.5 percent this year. "But today, our export volume is increasingly affected by the weak global economic recovery," he said.
He aired optimism that the country will be able to weather another global downturn, saying that political stability, prudent fiscal policies and a commitment to inclusive economic growth will serve the country well.
"As we strive to maintain this momentum, we are very conscious of the need to avoid protectionism, and we realize that we need to promote openness not only in investment, but also in trade," Yudhoyono vowed.
He aired hope that European countries will reach an agreement on vigorous measures to manage the crisis in their region. "The absence of such measures will have an unsettling consequence to all of us," he added.
He also said that another factor contributing to global instability was the tense situation in the Middle-East. "If these tensions persist, they can cause oil prices to rise even higher, thereby severely affecting oil-dependent nations worldwide. Currently, the price of oil is on a downward trend, however, we cannot be sure that it will remain that way,"
He said that soaring oil prices will pose a grave threat to global stability, slowing down economic growth, reducing production and inflicting recessions.
Yudhoyono said that at the G20 Summit, he will make a strong case for Multilateral Development Banks playing a key role in support of efforts to improve the global economy.
"They can help by diversifying sources of funding through greater use of credit enhancement and partial risk guarantees. Beyond mobilizing financing, they can provide recommendations to help developing countries overcome constraints, involve the private sector and develop well-advised projects priorities," he concluded.