TABLE OF CONTENT
Global Economic Performance and Outlook: Divergent Recovery,
Persistent Financial Market Uncertainty 6
National Economic Performance and Outlook: The Recovery
Process Continues, Stability is Maintained 16
Bank Indonesia Policy Mix 2021: Encouraging National Economic
Recovery, Maintaining Stability 26
• Rupiah Exchange Rate Stabilization Policy 28
• Monetary Policy Stimuli 29
• Macroprudential Policy Easing 30
• Acceleration of Payment System Digitalization 32
• Accelerating Money Market Deepening 36
• Empowerment of Sharia Economy and Finance and MSMEs 38
• Strengthening International Policy 41
• Bank Indonesia Transformation 43
Rise and be Optimistic: Synergy and Innovation for Economic
Recovery 44
Bank Indonesia Policy Mix Direction for 2022: Encouraging
Acceleration of Economic Recovery, Maintaining Stability 50
• Monetary Policy Direction 52
• Macroprudential Policy Direction 54
• Payment System Policy Direction 55
• Accelerating Money Market Deepening 57
• Inclusive and Green Economic-Financial Policy 58
• International Policy 60
Rise and be Optimistic for an Advanced Indonesia 61
Speech of the Governor of Bank Indonesia
BANK INDONESIA'S ANNUAL MEETING
Jakarta, 24th November 2021
We are honored to welcome,
The President of the Republic of Indonesia, Joko Widodo,
Distinguished guests,
• Leaders and Members of DPR and DPD RI,
• Leaders of State Institutions,
• Ministers of the Advanced Indonesia Cabinet,
• Chairman and Members of the OJK and LPS Board of Commissioners,
• Former Governors and fellow Members of the Board of Governors of Bank
Indonesia,
• Governors, Mayors and Regents from all over Indonesia,
• National Banking, Corporate and Media Leaders,
• Recipients of the 2021 Bank Indonesia Awards,
• Invitees.
Assalamu'alaikum Warahmatullahi Wabarakaatuh,
Greetings to everyone, Shalom,
Om Swastyastu, Namo Buddhaya,
Greetings of Virtue.
First, let us express our gratitude to the presence of Allah subhanahu wa ta'ala,one Almighty God, because
only with His grace and blessing can we gather today at the 2021 Bank Indonesia Annual Meeting. With all
humility, we would like to express our gratitude to the President who was willing to attend along with all
invitees.
We congratulate the banks, corporations, and individuals who have received the Bank Indonesia Awards
2021 a number of 57 awards in 4 areas and 17 categories in the fields of managing monetary stability
and financial systems, payment systems, MSME development and Islamic finance and economy, as well
as supporting Bank Indonesia policies. The awards are presented annually, in conjunction with the Bank
Indonesia Annual Meeting, as a form of appreciation and, at the same time, national recognition of business
partners who have supported task implementation at Bank Indonesia.
At this auspicious opportunity, allow us to present an evaluation of economic performance in 2021 as well
as the economic outlook and direction of Bank Indonesia's policy in 2022, which we summarize under
the theme "Rise and be Optimistic: Synergy and Innovation for Economic Recovery". A theme we think
is appropriate to show our shared enthusiasm to rise from the impact of the Covid-19 pandemic, with the
national economy continuing to improve in 2021. Optimistically, the national economy, God willing, will be
even stronger in 2022. Synergy, through strong policy coordination between the Government (Central and
Regional), Bank Indonesia, and the Financial System Stability Committee (KSSK - Komite Stabilitas Sistem
Keuangan), the banking industry and payment system, the business community, and all parties to continue
accelerating the national economic recovery, while maintaining macroeconomic and financial system stability.
Innovation, both in the coordination of national economic policies that includes fiscal-monetary coordination
for financing the State Budget during the pandemic, as well as in expediting digitalization and national
economic-financial inclusion by digitizing the payment system, the National Movement (Gernas - Gerakan
Nasional) in Proudly Made in Indonesia (BBI - Bangga Buatan Indonesia) and Proud to Travel in Indonesia
(BWI - Bangga Berwisata di Indonesia). It is this national economic policy synergy and innovation that we need
to continue to strengthen going forward in order for us to remain optimistic about the national economic
recovery in 2022 and subsequent years, towards an advanced Indonesia.
Our presentation consists of 5 (five) parts, namely: (i) Global economic performance and outlook, which
shows a divergent and asynchronous recovery, with persistently elevated global financial market uncertainty;
(ii) National economic performance and outlook that continues to improve towards recovery with maintained
macroeconomic and financial system stability; (iii) Bank Indonesia's pro-growth 2021 policy mix while
maintaining monetary and financial system stability; (iv) Increasing national economic policy synergy and
innovation and optimism about future economic recovery; and (v) The direction of Bank Indonesia's policy
mix in 2022 to encourage acceleration and foster innovation of the national economic recovery, while
maintaining monetary stability from the impact of global policy normalization. This explanation also serves as
the fulfillment of Bank Indonesia's accountability and transparency responsibilities as mandated in the Bank
Indonesia Act.
Global Economic Performance energy scarcity. Fourth, the asynchronous plan
and Outlook: Divergent Recovery, for monetary and fiscal policy to return to a new
Persistent Financial Market Uncertainty normal (exit policy) between AEs and EMDEs,
as well as the ensuing impact of global financial
The global economy continues to recover from market uncertainty. Fifth, the scarring effect
the deleterious effects of the Covid-19 pandemic. impact of the pandemic on corporate conditions
The world has been living with Covid-19 for and the risks that may occur to economic recovery
twenty one months. From living in fear and panic, sustainability and maintaining financial system
then surviving, until now - rising and optimistic stability. Sixth, the fast-paced digitalization of the
for a better life, with new habits, cultures, and financial economy with the dominance of several
civilizations. Likewise, economic developments, global big technology (BigTech) players and the
after surviving last year's recession, are now expansion of cross-border payment systems.
steadily improving and heading towards recovery. Seventh, growing demand for the green economy
Macroeconomic stability and the financial system, and sustainable finance in AEs must be well
which were threatened by the crisis at the prepared concerning the transition by EMDEs. The
beginning of the pandemic, have since improved following is an explanation of the seven challenges
and been maintained. However, we cannot be and anticipatory policy measures in Indonesia.
careless. The pandemic has not ended, and may
become endemic with the emergence of several The Covid-19 pandemic, which subsided at the
new Covid-19 variants. Vaccine distribution end of 2020, re-emerged with the Delta variant in
and ability to achieve herd immunity remain India in February 2021 and quickly spread to Asia
asynchronous throughout the world; with fast and various other parts of the world, threatening
roll outs in advanced economies (AEs) but more health and humanity. The Delta variant is highly
sluggish progress in many emerging markets and contagious and has a more virulent impact on
developing economies (EMDEs). Uncertainty human health and mortality than the Alpha
continues, with many unknown unknowns. and other variants. In 2021 more than 95% of
We must remain vigilant, therefore, to better Covid-19 transmission cases in various countries,
anticipate the risks that may arise and take including Indonesia, were due to the Delta variant
appropriate containment measures by approaching with a viral load 1,260 times higher than the
and praying to God Almighty. original variant. Furthermore, the incubation
period for Delta is also shorter, at about 4 days
The pandemic raises several issues and challenges after exposure, compared to an average of 6-14
that demand vigilance and must be anticipated days in the original variant. It is this combination
properly, now and moving forward. There are of a high viral load and short incubation period
at least seven important aspects we need to that has resulted in very fast transmission rates
pay attention to. First, vaccinations are still not and a higher mortality rate. Transmission in Asia
evenly distributed to achieve herd immunity, peaked in early May, before decreasing slightly in
thus increasing the risk of Covid-19 becoming June but re-emerging in August 2021 (Graph 1).
endemic. Second, the imbalances in the global In the Americas and Europe, the spread of Delta
economic recovery process, which is progressing peaked in August 2021 yet, until now,remains
more quickly in AEs yet slowly in EMDEs. Third, high. The impact on health has also been more
the occurrence of disruptions in the global severe, leading to a rapid rise in fatalities in Asia -
supply chain and the emerging threat posed by 1.54 % in late August and more steeply thereafter,
Graphic 1.Global Daily New Covid-19 Cases
Graph 1. Additional Global Covid-19 Cases Graph 3. Global Vaccination and Hospitalization Rate
Graphic 3. Vaccination Progress (Fully Vaccinated)
& Hospitalization
Thousands
Daily New Cases (Thousand)
as of 12 Nov
(7d MA) % total
Africa Region 2
per million Population
Asia 46
1000
Middle East and North Africa 10
100
US 122
140
Euro Area 334
88
90
125
Global 515
800 129
80
120 80
76 76
75
73
69
67
67 70
600 66
96
100 100
62 fully vaccinated
59
58 58
60
53
80
48
400 50
60 41
60 40
35
34
31
45 46
200
26 30
38
40
20
24
0
20
11 12 1 2 3 4 5 6 7 8 9 10 11
10
2020 2021
0 0
UEA ESP DNK IRL CAN ITA FRA GBR DEU ISR BRA TUR USA POL MEX RUS IDN IND WRL AE EM
Africa Region Middle East and North Africa
% current target, assumed by
AE (rhs) EM (rhs) Hopitalization
Euro Area Asia
others
per million the end of 2021 Herd Immunity
(Full Dose) reached
Data as of 12 November 2021
Source: WHO, calculated As of 8 Nov'21
Source: Our World In Data, calculated
Data as of 12 November 2021 Data as of 8 November 2021
Source: WHO, calculated Source: Our World in Data, calculated
having hit a low in early May 2021 (Graph 2). The namely the inequality of vaccination rates between
impact on mortality rates in the United States and AEs and EMDEs. In developed countries, given the
Europe is not significant, however, partly because of availability of vaccine supplies and the large fiscal
relatively high vaccination rates and herd immunity capacity of the government, vaccination rates have
in both parts of the world. reached an average of 66% of total population,
leading to lower rates of Delta variant transmission
The vaccination rate and restrictions on community and mobility restrictions (Graph 3). Overall, herd
mobility determine transmission of the Covid-19 immunity has begun to form in the community
Delta variant, as well as its impact on health and against Covid-19, with vaccination rates above 61%
humanitarian problems, including economic activity. of the population, with the highest rates recorded
Here in lies one of the fundamental problems of in the United Arab Emirates (UAE) at 88% to the US
the Covid-19 impact in different parts of the world, at 58%. Meanwhile in EMDEs, with limited vaccine
Graph 2. Global Covid-19 Fatality Rates Graph 4. Mobility Restrictions EMDEs
Grafik 2. Global Fatality Rate
Grafk 4. Tingkat Pembatasan Mobilitas
%
Emerging Market
3.5
Index, 100 = most stringent
100
3,0
90
80
2.5
70
60
2.0
50
40
1.5
30
20
1.0
1 2 3 4 5 6 7 8 9 10 11
100
2021
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11
2020 2021
Global US
Brazil China India
Euro Area Asia
Russia Indonesia Malaysia
Data as of 12 November 2021
As of: 15 Nov 2021
Source: WHO, calculated
Source: Goldman Sachs Research
Data as of 15 November 2021
Goldman Sachs ELI: Oxford Stringency Index + Google Mobility Report
Data as of 12 November 2021
Source: Goldman Sachs Research
Source: WHO, calculated
Goldman Sachs ELI : Oxford Stringency Index + Google Mobility Report
supply and fiscal capacity, the vaccination rate has Graph 5b. Retail Sales EMDEs
Grafik 5b. EM Retail Sales
Index, 100 = Q IV 2019
only reached an average of 34% and, therefore,
the spread of the Delta variant is more extensive.
110
Moreover, the level of mobility restrictions that
100
must be enforced to prevent Covid-19 transmission
is higher in EMDEs, though differing in terms of
90
time and duration (Graph 4). Disparity between
80
vaccination rates in AEs and EMDEs also explains the
70
different negative effects of the Delta variant on the
60
pace of economic recovery.
50
1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10
Several indicators point to a relatively rapid
2020 2021
increase in economic activity in early 2021 before Thailand
China Indonesia Mexico
Brazil
Turkey Russia
decelerating with the spread of the Delta variant.
Sumber: CEIC, diolah
The level of restrictions on public mobility due to the
Source: CEIC, calculated
second wave of the Delta variant and concerns about
a possible third wave have affected the Consumer
Confidence Index and retail sales in various been retreating since June 2021 (Graph 5b), while
countries. Again, the effects differ from country to the Consumer Confidence Index in India, which had
country, depending on vaccination rates as well as been decreasing since the emergence of the Delta
consumer perception and fears of a third wave of variant in February, has rebounded since July 2021.
infections. In advanced economies, for example, the This pattern of increasing retail sales will also have
Retail Sales Index, which had been increasing rapidly an impact on the downward trend in the rate of
since the end of 2020, has declined since March increasing consumption. Delta variant transmission
2021 in the US and July 2021 in Europe (Graph 5a). and mobility restrictions have also affected
In fact, the Consumer Confidence Index declined the Business Confidence Index and Purchasing
more sharply in the US than in Europe. In China, the Managers' Index (PMI), which in turn affects the level
Retail Sales Index and consumer confidence have of production and investment. Economic activity has
gradually improved since the third quarter of 2021
in line with the decline in Delta variant cases and
Graph 5a. Retail Sales AE greater public mobility. Nevertheless, the possible
Grafik 5a. Penjualan Ritel Negara Maju
emergence of new Covid-19 variants and the risk
Index, 100 = Q IV 2019
that the pandemic will last for a long time, potentially
130
becoming endemic,with the inherent impact on the
world economic recovery, must be considered.
120
110
Global economic improvements will continue
100
throughout 2021, though uneven, with recovery
90
expected in 2022.The speed of a country's
80
economic improvement is strongly influenced by
70
the vaccination rate to achieve herd immunity, the
60 magnitude of fiscal and monetary policy stimuli,
12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10
2019 2020 2021
as well as resilience in the face of Delta variant
US Euro Area Japan
transmission. In advanced economies, particularly
the US, economic recovery is progressing more Overall, after experiencing a 3.1% contraction in
rapidly, supported by unprecedented fiscal and 2020, the world economy is expected to grow
monetary stimuli. The stimulus package from by around 5.7% in 2021 and 4.4% in 2022 (Table
the government and central bank is funneled 1). Economic recovery has occurred in the two
into vaccination programs, social and business largest global economies, namely China with 8.0%
assistance, as well as the injection of massive and 5.4% growth in 2021 and 2022 after growing
liquidity (quantitative easing) to the financial 2.3% in 2020, and the US with 5.9% and 3.9%
system. On the other hand, most EMDEs, growth in 2021 and 2022 after a 3.4% contraction
except China, are still struggling to improve their in 2020. Meanwhile, economic recovery in other
domestic economic conditions towards economic countries is expected to occur in 2022 with
recovery. In addition to limited vaccine supply, continued economic improvements in 2021. Among
finite fiscal and monetary stimulus capacity has the advanced economies, Europe is expected
also undermined the economic recovery process. to grow 4.8% and 4.4% in 2021 and 2022 after
Most EMDEs have restrained ability to raise larger a 6.3% contraction in 2020, similarly Japan will
budgets, primarily as a corollary of lower tax grow 2.4% and 2.5% in 2021 and 2022 after a
revenues reduced by declining business activity, as 4.6% contraction in 2020. Among Asian countries,
well as limited debt capacity to finance larger fiscal India is estimated to grow at around 8.8% and
deficits. Meanwhile, monetary policy effectiveness 8.1% in 2021 and 2022 after a 7.1% contraction
to boost the economy has been hampered by the in 2020. Likewise, ASEAN-5 will grow 3.9% and
suboptimal condition of the banking and financial 5.4% in 2021 and 2022 after a 3.4% contraction
sectors, which have also been affected by the in 2020. The increase in world trade volume and
pandemic. international commodity prices will continue, thus
underpinning the outlook for exports and economic
Table 1. Global Economy: Growth, Trade Volume, Commodity Prices (%)iii
2019 2020 2021* 2022*
Global Economic Growth 2.8 -3.1 5.7 4.4
Advanced Economies 1.6 -4.5 5.1 3.9
US 2.2 -3.4 5.9 3.9
Euro Area 1.3 -6.3 4.8 4.4
Japan 0.0 -4.6 2.4 2.5
Emerging Economies 3.7 -2.1 6.1 4.9
China 6.0 2.3 8.0 5.4
India 4.8 -7.1 8.8 8.1
ASEAN 5 4.9 -3.4 3.9 5.4
Latin America 0.1 -7.0 5.1 2.8
Emerging Europe 2.5 -2.0 4.7 3.7
Middle East dan Asia 1.4 -2.8 3.9 3.8
World Trade Volume -0.4 -5.3 8.3 3.8
Indonesia Export Commodity Price Index -3.0 -0.8 60.3 2.5
recovery in various EMDEs. The world economic 5-year average despite indications of an increase in
recovery is expected to gain momentum in the exploration and production (Graph 7).
second half of 2022 and 2023 and beyond.
Disturbances in the distribution and supply of
Increasing demand fueled by the economic goods, exacerbated by energy scarcity, have impact
recovery that has exceeded supply capacity ed inflation globally. In addition to the divergent
owing to limited mobility caused by the Covid-19 economic recovery and mobility restrictions due to
pandemic has disrupted global supply chains and Covid-19, the problem is also driven by policy factors,
created energy scarcity. Delta variant transmission namely stronger demand for a green economy in
has caused numerous problems in the distribution Europe and the US amid production restrictions in
and supply of energy and production globally, as China and a number of other producing countries
reflected in the scarcity of containers, backlogs that require a transition period towards more
at many ports, longer delivery times, and rising environmentally friendly production (Scheme 1). At
shipping costs between countries, especially the same time, demand for energy is increasing in
since April 2021 (Graph 6). In the US, gaps are advanced economies in anticipation of supplies for
also appearing in the labor market, as seen in the winter. These factors have resulted in a
voluntary unemployment rate that is still increasing, productiondemand gap and higher international commodity
and also in increasing wages in the hospitality prices, such as oil, coal, and food prices (Graph 8).
and restaurant service sectors, education and Next is the impact on increasing actual inflation as
health, retail sales, manufacturing, as well as trade. well as forecasts of future inflationary pressures in
Meanwhile, in producing countries, particularly AEs, particularly the US, Europe, UK, Canada, and
China and other Asian countries, the enforcement Japan (Graph 9). The pertinent question, therefore,is
of mobility restrictions to break the domestic whether such inflationary pressures are temporary or
chain of Delta variant transmission has resulted permanent? Graph 9 shows that the inflation forecast
in production and inventory declines, as well as in several developed countries, as a whole, will be
the ability to ship, both for production and energy transient in nature, i.e., it will rise for the remainder
inputs such as oil, coal, and others. Concerning of 2021 until at least mid-2022, and then move
oil, inventories in the US have fallen below the downwards. Consequently, we need to be aware of
Graph 6. Shipping Rate Index: World and China Graph 7. Oil Inventories in the US and World
Graphic 6. Freight Rate Index
Oil Grafk Prices 7. Inventory, Rig Count, and WTI Prices
Index USD/40ft
counts, bbl
USD/bbl
million
3,500 11,000
1100 100
10,000
3,000
90
9,000
900
80
8,000
2,500
70
7,000 700
60
6,000
2,000
500 50
5,000
40
1,500
4,000
300
30
3,000
1,000 20
100
2,000
10
500 1,000
-100 0
9 10 11 12 1 2 3 4 5 6 7 8 9 10 11
1 3 4 6 7 8 10 11 1 3 4 6 7 8 10 11 1 3 4 6 7 8 10 11 1 3 4 6 7 8 1011 1 3 4 6 7 8 10
2017 2018 2019 2020 2021
2020 2021
US Inventory 5 year average of US Inventory
WCI - Drewry (rhs) China Containerized Freight Index
WTI (rhs)
Rig Count
*Data as of 11 November 2021
Data as of 12 November 2021
Scheme 1. Energy Crisis and Inflation Pressure
- Power rationing in China
- Green economy in Emerging Asia
and the US
POLICY - The green economy policy transition
Hurricane Ida & Nicholas
encourages high polluted energy
DESIGN
in the US, interconnector fire
sources production restrictions thus
(Promote Green
in the UK and France
increasing the green energy demand
Economy)
WEATHER,
ENERGY LOW
NATURAL
DISASTER & INVENTORY
CRUNCH
FIRES
Coal and oil inventories are at a low
level compared to the long-term
Extreme weather :
average
longer winter
WINTER
DEMAND
1. Decreasing Production 2. Rising Inflation
Source: Bank Indonesia
these developments over time to anticipate the with deficits starting to reduce from 2021, although
positive and negative impacts on the Indonesian the pace is much faster in AEs to around 3.6%
economy. in 2023, while in EMDEs it will be more gradual
to around 4.8% in 2024 (Graph 10). Likewise for
The asynchronous global economic recovery, monetary policy, it is likely that normalization will
coupled with supply disruptions and energy scarcity, be quicker in AEs and slower in EMDEs, reflecting
have led to a misalignment of fiscal and monetary the pattern of economic growth and the intensity of
exit policy plans between AEs and EMDEs. In inflationary pressures in each country. This can be
general, all countries will normalize fiscal policy, seen from market expectations concerning policy
Graph 8. World Commodity Prices: Oil, Coal, Graph 9. Actual and Forecasted Inflation: US,
Grafk 8. Harga Komoditas Dunia: Minyak, Batu Bara, Pangan
Grafik 9. Inflation (Realisation & Projection)
and Metal Composite Europe, Japan, UK, and Canada
Index, 100 = January 2020 Index, 100 = January 2020
%
200 450
5
180
400
160
350
3
140
300
120
250
1
100
200
80
150
-1
60
Inflasi refer to the CPI, except US (PCE)
Realisation until Oct 2021, except AS and Jp
100
40
Survey Bloomberg as of Nov 2021
-3
50
200 0
1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11
2 5 8 11 2 5 8 11 2 5 8 11 2 5 8 11
Graph 10. Fiscal Policy Normalization Plan: AEs and Graph 12. US Treasury Yields by Tenor
Grafk 12. Perkiraan Kenaikan Imbal Hasil US Treasury
Grafk 10. Rencana Normalisasi Kebijakan Fiskal:
EMDEs per Tenor Jangka Waktu
AEs dan EMDEs
Yield (%) Change of yield (bps)
% of GDP
Projection
2.5 50
0.0
2.0 40
-3.0 -3.0
-3.5
-3.6 -3.6 -3.5
-3.8
-2.0
-4.2
-5.2
-2.5
-2.4
-3.0
-2.7
-3.1 -3.0 1.5 30
-3.2
-7.9
-4.0 -3.6
-3.7
-4.1
-4.1
-4.8
-10.2 -4.4
-4.7
-4.8 -4.8
1 20
-5.2
-6.0 -6.6
-5.8
0.5 10
-8.0
-8.8
-9.6
0 0
-10.0
-10.8
-12.0
-0.5 -10
1M 2M 3M 6M 1Y 2Y 3Y 5Y 7Y 10Y 20Y 30Y
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Δ Oct-21 vs Sep-21 (rhs) Oct-21 Sep-21
World Advanced Economy Emerging Market Mar-21
Jun-21
Source: Bloomberg
Source: IMF Fiscal Monitoring October 2021
Source: IMF Fiscal Monitoring October 2021 Source: Bloomberg, calculated
interest rates, which are generally higher than the 2021 in response to unambiguous communication by
current situation (Graph 11). Even in the US, with The Fed. Nevertheless, uncertainty in global financial
the economic recovery running faster, as evidenced markets persists and has increased, influenced
by rising inflation and declining unemployment, the by the spread of the Delta variant as well as the
Fed has regularly conveyed plans to start reducing impact of global supply chain disruptions and energy
monetary liquidity (tapering) in early 2022 and this scarcity on rising inflation in the US and several
will likely be followed by a Fed Funds Rate (FFR) hike other advanced economies. As a result, the relatively
in the third quarter of 2022. This plan to normalize high inflow of portfolio investment into EMDEs in
monetary policy by the Fed has pushed up US early 2021 has decreased rapidly, especially since
Treasury yields (Graph 12), although the effect was March2021 (Graph 13) and the impact on currency
lower in September 2021 compared with March pressure and exchange rate volatility in EMs has
Graph 11. Monetary Policy Normalization Plan: Graph 13. Portfolio Investment Flows to Emerging
Grafik 13. Aliran Investasi Portoflio ke Emerging
Grafik 11. Rencana Normalisasi Kebijakan Moneter:
AEs and EMDEs Markets (EMs)
Economies (EMs)
AEs dan EMDEs
USD Billion
%
10
120
9
70
20
-30
-80
-130
876543210
6 10 2 6 10 2 6 10
BCB Banxico RBI BNM BOK BOT RBNZ FED BOE RBA ECB
2019 2020 2021
EM LATAM EM Asia Advanced Economies
Africa & Middle East Emerging Europe
Current Market Expectation (2022) Market Expectation (2023) 2020
Emerging Asia
Latin America
Source: IIF
Source: Bloomberg, data as of 16 November 2021 Source: IIF
Data as of 16 November 2021
Source: Bloomberg
Graph 14. Leverage of Non-Financial Graph 16. BigTech Active Users
Grafik 14. Leverage Korporasi Non-Finansial:
Grafk 16. Pengguna Aktif BigTech
Corporations: Global, AEs and EMs
Global, AEs dan EMs
USD Billion USD Billion
% (Debt ratio to GDP)
120
2.4 0.06
100
80
1.6 0.04
60
0.8 0.02
40
20
0.0 0.00
2004 2006 2008 2010 2012 2014 2016 2018 2020
0
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 (lhs) Alibaba Tencent (rhs) Kakao
Facebook Google Groupon
Global Advanced Economies Emerging Markets
Sumber: BIS
Source: GFSR, April 2021
Source: BIS
Source: IMF GFSR April 2021
also increased. This asynchronous normalization of capital. The level of debt (leverage) has increased
fiscal and monetary policies as well as increasing since the Covid-19 pandemic, both in AEs and EMDEs
uncertainty in global financial markets have further (Graph 14). In fact, the number of corporate defaults
complicated efforts to improve economic recovery in has soared to almost global financial crisis levels,
EMDEs, including Indonesia. dominated by the US, then Europe and EMs (Graph
15). Cases of corporate default that have occurred
The prolonged Covid-19 pandemic has had a in both the US and China are clear examples. Not all
scarring effect on corporate conditions and poses companies have been affected similarly, however,
risks to financial system resilience. Restrictions depending on the impact mobility restrictions have had
on public mobility as part of Covid-19 pandemic on their respective economic sectors. Notwithstanding,
handling have squeezed business activity, resulting in corporate damage demands continuous monitoring
declining sales, liquidity, profitability, and corporate for risks that could spread and have an adverse
impact on individual banking conditions and the
Graph 15. Total Corporate Defaults: stability of the financial system as a whole. That is
Grafk 15. Jumlah Kegagalan Korporasi:
Global, US, Europe, EMs why the normalization of regulations concerning the
Global, AS, Eropa, EMs
relaxation of credit restructuring provisions in many
Corporate
300
countries is meticulously carried out. In fact, financial
sector supervisory authorities in many countries
Global Speculative-Grade Corporate Defaults
250
have extended the regulatory relaxation period for
200
delays in principal and interest installment payments,
thereby providing concessions for the recognition of
150
non-performing loans (NPLs) in the banking industry.
100
The problem of corporate damage and its impact on
50
financial institutions and financial system stability still
needs to be observed during the ongoing Covid-19
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
pandemic. In fact, even though the overall economy
has recovered, corporate damage from the Covid-19
US Emerging markets Euro Others EM
pandemic requires more time to heal.
Source: Sumber: IMF IMF GFSR GFSR April April 2021 2021
Graph 17. Share of E-Commerce source of economic growth and is accelerating
Grafik 17. Pangsa E-Commerce
economic and financial inclusion. On the other
% of total retail sales
hand, however, a number of new problems are
emerging, including personal data ownership,
25
digital economic-financial transaction taxes,
21
financial services by non-financial entities
(shadow banking), the spread of privately created
17
currencies (crypto currencies), and regular
13
cyberattacks. In response to the various opportunities
and challenges posed by expansion of the digital
9
financial economy, appropriate policy measures
are required to re-position the role of the state,
5
2015 2016 2017 2018 2019 2020
including the finance ministry, central bank,
China Japan Germany
US UK
supervisory bodies for financial institutions,
Data s.d. Nov 2020 (AS), Okt 2020 (Tiongkok), Sep 2020 (Jerman, Jepang dan Inggris)
Sumber: BIS
technology and information, as well as security
Data as of Nov 2020 (US), Oct 2020 (China), Sep 2020 (Germany, Japan and UK)
Source: BIS
and defense, in a new - digital - civilization.
On the other hand, payment system digitalization In addition to the rapid pace of digitalization, the
and the financial economy are expanding with Covid-19 pandemic has also increased demands
rapidity, increasingly dominated by BigTech for the need to accelerate the green economy
and e-commerce. Digitalization occurred before and finance. In fact, country commitments to
Covid-19, driven by advances in digital technology, the problem of climate change and the need to
including artificial intelligence,as well as BigTech immediately adopt a green economy-finance
that was able to provide personal and model existed before the Covid-19 pandemic, as
economicfinancial services through mobile phones and stipulated in the 2015 Paris Climate Agreement.
other devices, anytime and anywhere (Graph 16). Various negotiations and agreements for trade
Artificial intelligence technology that can process and investment cooperation, both between
personal behavioral data is becoming increasingly countries and regions, have also included the need
sophisticated, offering consumer experiences to for adoption of the green economy-finance. Even
meet various needs for faster and more frequent in financial investor relations, including portfolio
economic-financial transactions through e-commerce investment, the preferences and demands of
platforms at massive volumes and frequencies fund owners (large and small) color the formation
despite low value per transaction (retail) (Graph 17). of investment portfolios by global investment
Since the onset of the Covid-19 pandemic, however, managers, including choices that tend to favor
with restrictions on public mobility and activity, EMs that are more pro-economy and green
digitalization of the financial economy and payment finance. Since the Covid-19 pandemic, demands
system has accelerated quickly. Digital for a green economy-finance have been getting
economyfinancial transactions, previously dominated by stronger from advanced economies, with, among
young people and millennials, have now spread to others, efforts to reduce carbon emissions that
various levels of society, becoming ubiquitous and are much larger, namely 8-9%,than around 2-3%
the new norm because of the convenience, speed, during the 2007/2009 global financial crisis
as well as low prices and transaction fees afforded. (Graph 18). Various countries, therefore, especially
This is not restricted to urban areas, yet extends EMDEs including Indonesia, must seriously
to smaller regions and across national boundaries. develop carbon emission reduction programs
The digital financial economy represents a new in order to fulfill the Paris commitments above
Graph 18. Carbon Emiss