Riska Rahman, Jakarta – Coordinating Economic Affairs Minister Airlangga Hartarto says that the now global coronavirus outbreak from China might become one of main challenges for Indonesia's economic growth this year.
"During a projection of the numbers affecting Indonesia's economic growth, the consensus is about 0.1 to 0.29 percent. We will see how we can adjust to this new challenge," Airlangga said in his speech during the Mandiri Investment Forum in Jakarta on Wednesday.
He added that the outbreak had already affected two sectors that had become Indonesia's economic growth drivers, namely tourism and trade.
About 2 million tourists from China visit Indonesia every year. The number, however, is expected to decline because of a restriction on travel to and from China imposed by the Indonesian government recently.
"The implementation of the travel warning, which will stop Chinese tourists coming to the country, will definitely make an impact [on the tourism sector]. We will evaluate this in two weeks," Airlangga said.
The minister said there might be a value chain disruption in the manufacturing sector, as the production of some goods was suspended in China because of the virus outbreak.
The coronavirus outbreak is also expected to cause greater impacts on the global economy and trade than the SARS outbreak in 2003.
"When the SARS outbreak occurred, China only [contributed] 7 percent [to the global economy], so the impact could still be contained. However, they are [contributing] 20 percent today and this will create a greater effect," the minister said.
He added that it was predicted that China's economic growth would decrease by 1 to 2 percent because of the outbreak.
Indonesian Employers Association (Apindo) chairman Hariyadi Sukamdani said on Monday that the coronavirus outbreak has begun to take a toll on not only on Indonesia's tourist industry but also on exports.
He said Indonesia's palm oil was among the affected commodities as the outbreak had caused a delay in the commodity's shipment to China, one of the major buyers.
"From us to them, it is mostly commodities such as crude palm oil and minerals. These exports have been affected," Hariyadi said. "Meanwhile, our imports from China, most of which are manufactured products and household goods, have all slowed." (roi)