Foreign Investors in the Indonesian Paradise

The influx of foreign funds into Indonesia is what makes the exchange rate and stock price index (JCI) gained since last week. This morning the exchange rate rose to Rp 11,748 per dollar from Rp 11,831 per dollar at the close last Friday. Reinforcement is finally pushing JCI opened higher by 0.37% to a level of 4524.53. 

Indonesia's economic fundamentals are stronger than ever. The central bank's monetary policy that focuses lowering the current account deficit to withstand the fall of the rupiah began to show results. Imports last year was able to be lowered to 2.64% compared to the year 2012. 

Throughout the year 2013, Indonesia had a trade surplus of five months. Astonishingly, the surplus occurred successively in October, November, and December. In closing the end of 2013, Indonesia gained surplus to $ 1.52 billion, and this is the highest record ever achieved since November 2011. 

With this surplus, the current account deficit narrowed quarter IV 2013. Balance of payments, the broadest measure of trade and investment for, posted a surplus of $ 4.41 billion in the fourth quarter of 2013. This is the only surplus on a quarterly basis throughout 2013. 

Similarly, foreign exchange reserves continued to grow and now back to break above the psychological level of $ 100 billion, to be exact US $ 100.3 billion as of January 2014. 

Indonesian Economy is still able to grow 5.78% in 2013, although it slowed disbursement of bank credit and liquidity tightened. This growth is the second highest in the group of the world's largest economy, the G20, after China. 

This data was seen foreign investors. They assess, Indonesia is now back to being one of the most desirable places to raise money. "If you are looking for yield in Asia, go to Indonesia or India. In Indonesia, foreign investors more easily enter the market, "said Cecilia Chan, chief investment officer for fixed income at HSBC Global Asset Management, the fund manager of $ 419 billion. 

Yield (yield) Indonesian government bond term of 10 pegged as high as 8,710%, over three times that of similar bonds in the United States. In the Asian market, the yield on the bond can only be defeated by India, which is 8.850%. 

However, many economists warned, raise dollars with this model is not without danger. Therefore, many economies are supported by activities in the money and capital markets may result in economic aka bubble economy bubble. 

That is, the entry of foreign funds that do not make the government complacent. Therefore, this model investors only make a profit from the high interest. 

Moreover, Indonesia will soon hold legislative elections and the Presidential Election. Typically, the party of democracy in developing countries, such as Indonesia, the political temperature will rise hotter. 

Equally important is the improvement in the economy in developed countries, especially the United States. If the economy of these countries has improved, foreign investors will return to its original place, look for the safest place to look for money.