REPUBLIKA.CO.ID, JAKARTA - Financial turmoil in Cyprus would not affect much to Indonesia, an economist from Universitas Indonesia (UI), David Sumual, said. But he warned that national banks to be alerted of the risk of foreign capital outflow from Indonesia.

Yet, he predicted that Cyprus crisis had no direct impact to Indonesia considering that Indonesian banks still focus on developing local market. "Indonesian banks rarely invest in large amount abroad," he said on Sunday.

In sectoral, bank customers must also curb their desire to invest in high return investment. He exampled that in 2008-2009 large number of people invested in mining stock. Sadly, it suffered overexposure and then fell when crisis happened.

Financial crisis in Cyprus forces wealthy depositors to lose up to 60 percent of savings. For any depositors of Bank of Cyprus with holdings over 100,000 euros, 37.5 percent of holdings are to be converted into banks shares. Another 22.5 percent will be withheld.

Governor of Bank Indonesia (BI), Darmin Nasution, sees the Cyprus crisis as a small problem yet potentially incite global financial turmoil. "Investors seek safer place in the form of USD or gold," he said.

During risk off condition, he explained that Composite Index and exchange rate in several countries would weaken, contrary to the strengthening USD and gold. However, Nasution said that Indonesian economic condition would be able to survive. He claimed that Indonesia was stronger compared to Brazil, India and Turkey in term of overcoming the bank's credit risk.

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