Indonesia has experienced significant economic and financial developments since the 1990s. These changes include aspects such as economic growth, currency stability, and financial sector development. Here are some of the differences between Indonesia’s financial situation in the 90s and today:
Economic Growth
The 90s: In the early 90s, Indonesia experienced high economic growth, especially during the “New Order” period. However, then came the Asian financial crisis in 1997 which resulted in a drastic decline in economic growth.
Current: Indonesia has recovered from the financial crisis and recorded steady economic growth. Economic reforms and wise macroeconomic policies have helped Indonesia become one of the largest economies in Southeast Asia.
Currency Stability
The 90s: The Asian financial crisis in 1997 triggered a depreciation of the rupiah. The rupiah depreciated significantly against the US dollar, creating inflationary pressures and worsening economic conditions. At current era, Bank Indonesia has made efforts to maintain the stability of the rupiah exchange rate. While it still faces certain fluctuations, policy efforts have helped minimize the risk of significant depreciation. More difference in Financial Sector Development:
The 90s: In the 90s, Indonesia’s financial sector still faced challenges in terms of transparency and regulation. The capital and banking markets underwent restructuring in response to the financial crisis. Today in Indonesia’s financial sector is experiencing rapid development. The adoption of financial technology (fintech) has increased, providing access to finance to more people. In addition, Indonesian banks are increasingly integrated with global markets.
Infrastructure Improvement
The 90s: Indonesia’s infrastructure was still limited in the 90s. This limited economic growth and access to various regions. Now Indonesian government has focused on infrastructure development. Major projects such as the construction of toll roads, airports, and ports have improved connectivity and supported economic growth.
Financial Education
The 90s: Financial education in the 90s has not been a major focus. Some people may have lacked an adequate understanding of financial management.
Today: There is an increased awareness of the importance of financial education. Financial education and literacy programs have been introduced to help people manage their finances better.
Conclusion:
The difference in Indonesia’s finances between the 90s and today reflects the massive transformation in the country’s economic and financial conditions. Despite facing challenges such as the financial crisis, Indonesia has managed to recover and grow into an increasingly resilient economic powerhouse at the regional and global levels. This transformation demonstrates the importance of sound economic policies, structural reforms, and adaptation to global changes to ensure the sustainability of healthy economic growth.
