Fuel Can Be an Economic Stimulus


Indonesia’s economic weakening has widely been discussed in public. One of the impacts of the economic weakening is termination of working because a lot of industries cannot bear the elevation of production cost and pay the staffs’ salary. The termination of working leads to the increasing of unemployment and poverty.

“Various efforts to cope with the issues become the duty of government for this one last period. Thus, Indonesia entails economic stimuli so that Indonesia’ economy can be better and stable,” stated a lecturer of Economics of Universitas Muhammadiyah Yogykarta (UMY) in a restricted discussion on Tuesday (7/10) at Economic Faculty of UMY.

He mentioned that one of the governments’ steps is undertaking economic efficiency through providing subsidy of fuel price for fuel businessmen and public. “Public now need aid or an immediate stimulus that they can perceive the impacts. The stimulus is through government’s policy which is alleviating the fuel price,” he contended.

He inserted that industries spend 20% for energy cost, while public spend 10% for energy cost and 10% for transportation cost each month. If government does not subsidize the huge energy and transportation cost, their burden is getting harder. Thus, the alleviation of fuel price can improve Indonesia’s economic weakening. “The cost spent by industries and public in the sector of fuel use is adequately high so that the decreasing of the fuel price may become a proper solution. The termination of working may alleviate and public economy will lift and be better,” he added.

He expected that government can plan the fuel price alleviation in policy design. “In the first policy, the government focused on monetary policy, and in the second policy the government concerned with inflation regulation. Hence, in the next policy making, government can concentrate on fuel price alleviation to enhance Indonesia’s economy,” he ended.

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