Indonesian leader calls for unity, braces for global crises

JAKARTA, Indonesia (AP) – Indonesia’s president called on all citizens to remain united, vigilant and alert as they face crises fueled by the war in Ukraine and the coronavirus pandemic in his speech on the ‘state of the nation on Tuesday.

After two years of remote meetings amid pandemic restrictions, more than half of Indonesia’s parliament attended as President Joko Widodo told them and top officials on the eve of Independence Day that tensions regional threats to security.

“We must always remain vigilant, cautious and alert,” Widodo said. “Crisis after crisis still haunts the world.”

He noted that when the war broke out in Ukraine leading to energy and food crises, the world was still struggling with the economic and health impacts of COVID-19. Some countries are predicted to fall into bankruptcy, while more than 550 million people face extreme poverty and 345 million others suffer from food shortages and hunger, Widodo said.

“The challenges are not easy for the world and for Indonesia. We must face these challenges with prudence and vigilance,” he said.

Russia’s war in Ukraine has exacerbated rising prices in Indonesia amid ongoing supply chain disruptions from the pandemic, sending cooking oil prices soaring as disruptions to wheat, soybeans and corn have affected the cost of various foods.

In April, Indonesia banned all exports of crude palm oil, a key ingredient in cooking oils, for a month amid a series of student protests against rising food prices. Indonesia and Malaysia are the world’s largest exporters of palm oil, accounting for 85% of world production.

As host of the Group of 20 richest and largest economies this year, Indonesia has sought to overcome divisions among its members over Russia’s invasion. Widodo has been cautious in his comments about the war in Ukraine in an attempt to remain neutral.

Widodo was the first Asian leader to visit warring countries. Ukraine is not a member of the G-20, but Widodo has invited Ukrainian President Volodymyr Zelenskyy to the November summit along with Russian President Vladimir Putin, hoping to appease all sides and limit any distractions from the G-20 agenda. forum. Zelenskyy has said he will not attend if the war continues then and has opted to follow the discussions by video link.

Indonesia’s inflation rate has been relatively modest and the shock has been mostly absorbed through a budget bolstered by energy subsidies.

Widodo said the state budget recorded a surplus of 106 trillion rupiah ($7.2 billion), allowing the government to provide fuel, gas and electricity subsidies of 502 trillion rupiah ($34 billion ) this year to cushion fuel prices.

However, he said the administration needs to recalculate its energy subsidies to reduce the budget burden.

Southeast Asia’s largest economy served as a key exporter of coal, palm oil and minerals amid a global commodity shortage following Russia’s invasion of Ukraine. Coal exports rose to record levels in March after a brief ban on their shipments earlier this year to secure domestic supplies.

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