Highlights in the media today: Public debate about government’s plan to relax large-scale social restrictions (PSBB) continues, widening budget deficit might cause private-public liquidity competition, tourism recovery strategy to prioritize health protocols. 

A public debate about the government’s plan to relax the large-scale social restrictions (PSBB) is still ongoing. On Tuesday (May 19), the Jakarta administration announced that it would extend the large-scale social restrictions (PSBB) for the third time. The extension, until June 4, comes without any relaxations of the restrictions.

The decision was made based on a study by Universitas Indonesia’s (UI) Public Health Faculty, which revealed that only 60% of Jakarta residents had complied with the stay-at-home policy since the PSBB was first implemented on April 10. The study traced people’s movements by tracking their phone signals.

Universitas Airlangga Patient Safety Research Center Head Inge Dhamanti said in a webinar on Tuesday (May 19) that the PSBB in East Java had not been effective; hence, it should not be relaxed. Universitas Airlangga Public Health Faculty Alumni Association surveyed 2,834 people in 38 cities and regencies in East Java and found that many public activities continued to take place during the PSBB from May 4-8. Inge added that most people who took part in these activities did not wear masks.

Eijkman-Oxford Clinical Research Unit Epidemiologist Henry Surendra said that Indonesia had yet to meet two of the six criteria for easing restrictions set by the WHO — controlling the transmission at the population level and having sufficient hospital capacity.

As of May 20 15:52 (GMT+7), Indonesia had recorded 19,189 COVID-19 cases with 4,575 recoveries and 1,242 deaths.

The widening budget deficit, which now stands at 6.27% of the gross domestic product (GDP), might cause a competition for liquidity between the government and the private sector in the short term. Center of Reform on Economics (CORE) researcher Yusuf Rendy Manilet said that an unintended liquidity competition might erupt as both private and public sectors were looking to secure liquidity from the same market at the same time.

The government has recently offered bonds, which will absorb some liquidity from the market. Considering the government’s high need for liquidity, it might be difficult for the private sector to get affordable financing in the domestic market. The private sector might have to bear a higher cost to attract investors to buy its bonds.

Health protocols seem to be the cornerstone of the government-planned tourism recovery strategy. Tourism and Creative Economy Ministry Resources and Institutional Affairs Head Frans Teguh said that the ministry will launch online marketing campaigns and improve hygiene and safety standards in major tourist destinations to attract foreign tourists.

According to the latest data issued by Statistics Indonesia (BPS), foreign tourist arrivals fell 64.1% year-on-year (yoy) in March, a level unseen since February 2009.

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