Indonesia's Economy Shows Resilience Amid Venezuela Conflict

Government Confidence in Economic Stability

Indonesian government officials have expressed confidence in the country's economic resilience amid the escalating conflict between the United States and Venezuela. Coordinating Minister for Economic Affairs Airlangga Hartarto emphasized that the government continues to monitor the situation closely, particularly regarding oil prices ¹

Minimal Direct Economic Impact

The direct economic impact on Indonesia is expected to be minimal due to the country's limited trade with Venezuela. Economist Nailul Huda from CELIOS noted that bilateral trade between Indonesia and Venezuela constitutes only 0.02% of Indonesia's total exports, suggesting that the conflict will not significantly affect Indonesia's economic performance ⁵

Market Reaction and Oil Prices

The conflict has led to fluctuations in global oil prices, with an initial increase of around $2 per barrel following the US military operation in Venezuela. However, the impact was short-lived as global oil supply remains in surplus ⁷

Government Preparedness

Despite the minimal direct impact, economists have urged the government to remain vigilant. Yusuf Randy Manilet from CORE Indonesia suggested that the government should incorporate the geopolitical escalation into their economic impact calculations, including assumptions for macroeconomic planning and fiscal risk mitigation strategies ⁶