Jakarta – Most institutional investors in the financial market want President Joko "Jokowi" Widodo to appoint professionals to the economic team in his next Cabinet to ensure that the economy is professionally managed.
The expectation is reflected in a Katadata Insight Center (KIC) survey, which involved 260 senior executives of fund management companies, pension funds and insurance companies with total investments of Rp 700 trillion (US$50 billion).
The survey was conducted through interviews by telephone and email between June 24 and July 2.
"As many as 65 percent of institutional investors interviewed said that the ideal economic team in the new Cabinet should comprise independent professionals," the CEO of media and research company Katadata, Metta Dharmasaputra, said in a press briefing in Jakarta on Thursday.
Meanwhile, as many as 32 percent of respondents think the ideal economic team should comprise both professionals and representatives of political parties, and the remaining 3 percent want all economic team members to come from political parties.
Jokowi and his running mate Ma'ruf Amin, who won the April presidential election, will be formally installed as the 2019-2024 president and vice president in October. Political and economic observers have called on Jokowi to soon name his new Cabinet in order to reduce speculation.
Apart from the composition of the economic team, investor attention is also still focused on the uncertainty of the global economy. In general, the condition of the economy and capital market in the second quarter of this year was considered good. This can be seen from the Katadata Investor Confidence Index (KICI), which showed a score of 146.8.
However, when compared to the previous quarter, investor optimism toward economic conditions in the second quarter declined slightly. This was reflected in the decline in the KICI index, which fell 2.8 points from 149.6 in the first quarter to 146.8 in the second quarter of 2019.
"There are many aspects that have made investor optimism decline. One of them is the trade war between the United States and China, which is feared to have an impact on the national economy, "said Damhuri Nasution, a member of the Katadata Insight Center's expert panel.
The KICI is an index that measures the confidence of institutional investors in the economy and financial markets under current conditions (Current Situation Index) and for the next three months (Expectation Index).
The KICI captures perceptions of institutional investors regarding current conditions, domestic and global economic prospects, stock market performance, portfolio value prospects and the possibility of additional investment in the capital market. (hen)