Ensuring Policy Clarity and Certainty for Businesses: The Urgent Need in the Face of Global Uncertainty and Leadership Changes

World Bank calls on new governments to offer predictable policies for economy

The International Monetary Fund (IMF) issued a warning in a report last October regarding the need for countries, including Indonesia, to address growing fiscal risks, such as tight financing conditions and rising concerns about debt vulnerabilities. The World Bank is encouraging these countries to enhance policy clarity for businesses as a sustainable approach to drive economic growth, particularly in the face of limited fiscal and monetary capacity due to global uncertainty.

Manuela Ferro, Vice President of the World Bank East Asia and Pacific, emphasized the importance of addressing policy uncertainty, especially with multiple countries experiencing leadership changes this year. She highlighted the need for new administrations to promptly communicate policy directions to households and companies to provide clarity and certainty.

Ferro also highlighted the importance of creating a competitive investment regime that would attract more investors into economic activity. With more than half of the world’s population voting this year, several Asian countries, including Indonesia, have already held elections. Indonesia’s General Elections Commission recently announced Prabowo Subianto as the winner, set to be sworn in as the new Defense Minister in October, along with his running mate Gibran Rakabuming Raka.

Ensuring policy clarity and certainty for businesses is critical for sustainable economic growth, especially as countries navigate global uncertainty and leadership changes.

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