Three Economic Strenghts

Indonesia possess an abundant supply of energy, commodity and mining resources, which help the economy in many ways.

"Vice President Jusuf Kalla said Indonesia has three economic strengths which most industrialized countries do not have in plenty. “What Indonesia has which other countries do not have in abundance are energy, commodities, and mining products,” said Kalla in a seminar themed “City Indonesia Mid Year Economic Outlook 2007” here Thursday (19/7). Most countries do not have these three and the world’s industrialized countries are in badly need of energy, commodities and mining products. And fortunately, their price are on the increase. “It so happens that Indonesia has got natural gas, oil, coal and other minerals. And they are our major strength,”he said. The oil price at the moment tends to increase. Even though government subsidy similarly goes up, it is balanced by our oil price hike.

Indonesia exports its own crude but imports lower priced oil for home consumption. Similarly, commodity prices tend to increase at the moment. One of them, crude palm oil, is used as raw material for the manufacture of bio fuel. “True, we need CPO for the making of cooking oil at home but we only need 30% of total CPO production. The remaining 70% are exported with slightly increased export tax because the government needs money to lower the price of cooking oil, which has recently increased.“

Besides, Indonesia is rich when it comes to mining products, such as nickel, aluminum, copper, bauxite and some other minerals. Our next step is to see to it that the government could benefit from their added value.

With these three strengths, social condition keeps on improving, banking interest rates go down and infrastructure is being intensively carried out by the government.

Resources provide a country with natural advantages over other countries, which must import specific resources in order to develop their economies. Domestic resources low the cost of doing business and increase productively at a quicker rate, since the country does not rely on outside partners for key resources. Energy resources can also lower business cost, because a great supply of energy leads to cheaper energy and lower business costs." … "Three Economic Strenghts" has a significant impact, so an analyst should put more weight into it. This statements will have a short-term positive impact on this entity, which adds to its value. "Three Economic Strenghts" is an easily defendable qualitative factor, so competing institutions will have a difficult time overcoming it.