Coronavirus Update #49 February 1, 2021
Cumulative number of reported cases: 1,089,308 (as of February 1)
Rupiah to US$14,042
Jakarta Stock Exchange Index: 6067
As Indonesia’s races to vaccinate the COVID pandemic continues to spread as cumulative cases top 1 million and daily detection and deaths continue to set new highs. The fatality rate is 2.78%. (US rate is 1.68% and worldwide rate is 2.1%). Even if Indonesia’s COVID numbers are significantly undercounted, its pandemic pales in comparison to that in the similarly sized US (26 million cases) or even Brazil (9 million). Indonesia’s hospital infrastructure is small relative to that in the US or EU and it obviously experiences greater stress and higher mortality. Several times now President Jokowi has acknowledged (or admitted) that the current mobility restrictions have not curbed the growth in cases. However, a sustained, complete lockdown, without an adequate safety net, could do more harm than good, given the high proportion of workers that rely on end-of-the-day wages.
With urban hospitals reaching their capacity some may be forced to discharge patients with relatively minor symptoms to make beds available for only the most serious cases. The head of the Jakarta doctor’s association suggested that those patients with milder symptoms stay at home and be treated by visiting doctors from neighborhood clinics.
Meanwhile, Indonesia has commenced administering of vaccinations. As of January 27, 250,000 people have received their jabs. Eventually 900,000 a day will receive it if sufficient supplies can be imported or locally sourced. The new Health Minister is currently considering using voter registration data to help guide vaccine allocations.
Anxious that that the EU and other nations would favor its own people and not distribute vaccines equitably, Indonesia’s Foreign Minister, Retno Marsudi, has decried “vaccine nationalism”. This position might be better accepted had the country better protected the intellectual property of foreign-sourced medicines and drugs, nor created local content rules that have led to the unavailability of certain vaccines and medical devices.
Foreigners are not currently permitted to enter Indonesia without a valid residency permit. The restriction expires February 8 but could be extended. Visit Indonesian Immigration (https://www.imigrasi.go.id) and the Indonesian Embassy (https://kemlu.go.id/washington/en) for updated visa and entry requirements as regulations may change frequently.
Sandiago Uno, newly appointed Minister of Tourism, is encouraging local and resident expat workers to work remotely from Bali, given the huge drop in tourists. The effort will not fully revive the tourism industry but could keep local hotels afloat.
Inflation Slows: Indonesia’s annual inflation rate slowed for the first time in five months in January, staying below the central bank’s target range, data from the statistics bureau showed on Monday (02/01). The consumer price index rose 1.55 % annually in January, compared with an increase of 1.68% in December and against expectations for a 1.66% rise in a Reuters poll. Bank Indonesia’s 2021 inflation target range is 2-4%.
Rupiah Could Strengthen: Indonesian rupiah is expected to strengthen further against the U.S. dollar as foreign investors could pile billions back into the country’s financial market, said Perry Warjiyo, governor of Bank Indonesia. The currency has stayed roughly flat against the U.S. dollar this year, after losing 1.1% to the greenback in 2020 at the height of the Covid-19 pandemic. Warjiyo estimated an inflow of around US$19.6 billion of foreign funds this year into the Indonesian financial market.
New Sharia Bank: Indonesia’s President Joko Widodo launched operations of Indonesia’s largest Islamic lender on Monday (02/01) in a move to boost the sharia finance industry in the world’s largest Muslim-majority nation. Bank Syariah Indonesia was formed by merging Islamic banking units of Indonesia’s state-lenders BNI Syariah and Bank Syariah Mandiri into BRI Syariah BRIS.JK, combining US$17.13 billion in assets and core capital of US$1.6 billion as of December 2020.
(sources: International and Indonesia news media, Bali Update (from balidiscovery.com), Reformasi Weekly)