Gov't's Latest Policy Package is Credit Positive: Moody's
Jakarta. Moody's Investors Service said the Indonesian government's latest policy package is a "credit positive" as it signals a renewed focus on improving investment climate.
"The announcement of the latest policy package suggests the economic reform agenda has not been derailed by political considerations," Anushka Shah, an analyst at Moody's Investors Service Singapore sovereign risk group, said in a note on Friday (23/06).
Shah said the recent Jakarta gubernatorial election earlier this year at first seemed to have lulled the government's reform agenda.
This latest policy package is the first since November 2016 and the seven-month gap between policy packages "underscored the continued close linkage between politics and policies."
Moody's noted the 15th policy package provides business opportunities for logistics companies and makes them more competitive by streamlining and simplifying regulations. It also reduces operating costs and the number of restricted goods at ports.
"Over time, the measures will help reduce overall logistics costs and help the development of local firms in the sector," Shah said.
Indonesia ranks 63rd out of 160 countries on the World Bank's Logistics Performance Index behind India (35th) and Thailand (45th).
Moody's upgraded Indonesia's rating outlook from stable to positive in February on the back of improvements in business environment and GDP growth.
The decision to lift the rating, according to the agency's statement, was made after considering the effects of the Indonesian government's string of policy packages since September 2015.
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