REPUBLIKA.CO.ID, JAKARTA -- The People Bank of China (PBoC) or the Central Bank of China devaluated its currency on Tuesday (11/8). Indonesia should be aware of the devaluation.

Former Minister of Finance, Chatib Basri, said through his twitter account, @ChatibBasri, that the devaluation of the yuan could affect Indonesian exports to China. The implication prices of Indonesian exports to China could be more difficult, because the price of goods in China would be cheaper.

"Indonesian Export to the world market could become increasingly difficult because of the price of Chinese goods become cheaper," said Chatib, Wednesday (12/8).

If the Chinese economy strengthened, Indonesian exports could increase. However, the devaluation of the yuan will not clearly affect to the Indonesian economy. Because China is also bound to limit imports from other countries.

The yuan devaluation will complicate the development of the Euro zone, because it will be increasingly uncompetitive. These conditions certainly have an impact on the economic recovery of the Euro. The devaluation of the yuan could also make the Fed postpone the increase of interest rates.

“The devaluation of the Yuan will also hit Asian exports in the world market," he added.

Ikuti Whatsapp Channel Republika