Policy normalization that will be conducted by developed countries, such as the United States and Europe, will affect the recovery process in several developing countries, Bank Indonesia (BI) Governor Perry Warjiyo stated.
“The biggest risk from the macroeconomic and monetary policy is the normalization process,” the BI governor noted at the G20 Indonesia Presidency Agenda here on Saturday.
Warjiyo pointed out that several developed countries had recovered and would soon start to normalize their policies. However, there are still several developing countries, including Indonesia, which are just starting their economic recovery.
The normalization process caused the global economic recovery and monetary policy to be out of sync, thereby creating several new problems, especially for developing countries.
In the meantime, apart from policy normalization, other risks still loom large over the recovery process, such as the spread of the Omicron COVID-19 variant, supply chain disruption, and energy issues.
Hence, Warjiyo emphasized that the policy normalization process should be integrated and coordinated, so that recovery runs in a balanced manner, both for developed and developing countries.
The BI governor pressed for developed and developing countries as well as international organizations, especially the IMF, to work together to normalize policies.
“Hence, we need to emphasize the importance of being well-calibrated, well-planned, and well-communicated,” he stressed.
Source: Antara News