REPUBLIKA.CO.ID, JAKARTA -- Japan's Rating and Investment Information Inc. (R&I) has again rated Indonesia as "investment grade," Bank Indonesia governor Agus Martowardojo said here on Tuesday.
The new rating came on April 4.
He said Indonesia's economic resilience in the midst of economic volatility and global financial pressure was the basis for this rating.
"Indonesia's economic resilience amidst global financial volatility and economic uncertainties has been recognized by the ranking agencies. The increasingly synergic combination of fiscal and monetary policies will make the economy healthier while efforts to usher in structural reforms are continuing," he said.
Bank Indonesia reported that R&I had affirmed Indonesia's sovereign credit rating at BBB-level or stable outlook on March 18, 2015.
He said Indonesia was rated as investment grade because its economy remained stable despite external uncertainties.
The monetary policy that was applied was accommodative and was accompanied by a proactive fiscal policy to support economic growth.
The executive director of Bank Indonesia's Communication Department, Tirta Segara, said Indonesia's fiscal deficit was also considered low with fiscal flow condition being under control.
Foreign exchange liquidity has also been maintained through central bank policy and good foreign exchange reserves although non-bank private foreign debt must be monitored closely.
"R&I thinks Indonesia's domestic economic slowdown in 2015 was caused by economic uncertainty and global finance problems," Tirta said.
In 2016, R&I saw Indonesia's economy being boosted, with government spending acting as an economic mover and household consumption going up as a result of the central bank loosening its monetary policy.
R&I appreciated the government's commitment to bring in structural reforms including energy subsidy reforms as a positive development.
"The energy subsidy reform made room for the fiscal sector to be able to increase allocation of spendings linked to infrastructure supply and other productive sectors to make Indonesia's economy grow higher," according to Bank Indonesia.
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