Jakarta. The Finance Ministry said capital outflow in the first quarter of 2020 – triggered by panic in the global financial market caused by the coronavirus crisis – was two times bigger than during the 2008 and 2013 crises.

Sri Mulyani said the Covid-19 pandemic had caused panic among global investors as stock market performance declined in both developed and developing countries.

"The volatility index in March showed investors' fear gauge had reached its highest point in history due to the turmoil in developed and developing countries' stock markets. The consumer confidence index had also fallen significantly, more so than during the 2008 [global financial] crisis," she said on Monday.

That fear was behind all the massive capital outflows from emerging markets including Indonesia.

During the first quarter, the capital outflow in Indonesia was twice as big compared to those during the 2008 and 2013 financial crises.

The accumulated outflow between January and March was Rp 145.28 trillion ($9.7 billion).

In 2008 and 2013, the outflows reached Rp 69.9 trillion and Rp 36 trillion respectively.

"Developing countries have been experiencing massive capital outflows because investors now look for safe assets and by that they mean hard currency, dollars in cash," Sri Mulyani said.

"Overcoming this problem is the main task of the Financial System Stability Committee (KSSK)," she said.

Credit Restructuring to Help Businesses

The chairman of the Financial Services Authority (OJK), Wimboh Santoso, said until May 10 the agency had approved Rp 336.97 trillion in credit restructuring from 3.88 million bank debtors.

Credit restructuring is part of government relaxations aimed at helping struggling businesses, especially small and medium enterprises (SMEs), during the pandemic.

Wimboh said most of the credit restructuring, a total of Rp 167.1 trillion, was for 3.42 million SME debtors.

A total of Rp 43.18 trillion in credit restructuring for 1.32 million financing companies had also been approved by May 8.

Currently, the OJK is processing debt restructuring contracts for 743,785 more debtors.