UNAIR NEWS – After announcing the fuel price hike on Saturday, September 3, 2022, in the Merdeka Palace, Jakarta, President Joko Widodo said that they had prepared unconditional cash transfers (BLT) for the low-income communities. Jokowi instructed the regional heads to use two percent of general transfer funds of Rp2.17 trillion for workers in the transportation sector.
UNAIR Economy Expert, Dr. Wisnu Wibowo believed that though the BLT does relieve the intensity in the short term, it will not cover the agony.
“The Government switches the psychological approach by making people happy, to keep them away from the shock. In the happy state, they raise the price. It’s different compared to decisions that were made when everyone is upset. Even less popular decisions will give enduring consequences,” said Dr. Wisnu on Sunday, September 11, 2022.
Proactive policies and regulations, especially for community productive business development will help to fix the agony. He also suggested the government postpone the community and entrepreneur’s tax policy.
In this situation, the poor, vulnerable groups, and entrepreneurs are also needed to be assisted. The fuel price hike will definitely decrease production and increase the raw materials, resulting in decreasing sales volume.
“COVID funds will be unavailable next year, while the economic pressure on the micro, small, and medium enterprises (MSEs), have not fully gone due to COVID. Now, they have to face this. How?” said the UNAIR Faculty of Economics and Business lecturer.
Besides, other assistances such as opening market access, access to capital, and others need to be conducted. Wisnu was concerned with the impact of fuel prices hike, which will increase the loan interest rate, while the increased loan interest rate will also raise the loan burden for MSMEs.
He suggested the community monitor the BLT distribution by government. Besides, the rising fuel price is expected to raise the government and community’s awareness of green and blue economies (eco-friendly economies).
“If we did not provide the space for the growth of electric vehicles, it won’t grow,” he ended.
Author: Afrizal Naufal Ghani
Editor: Nuri Hermawan
