Fiscal and Monetary Policy for The Development of Indonesian Plantation

Abstract

The global monetary crisis in 2007-2008 and the focus of development on climate changes make it important to promote a healthy economic growth based on the local resources, The economic crisis, which has slowed down the economic growth and has caused job losses which result in increasing unemployment and poverty, should alter the focus of Indonesian economic development in the future to be based on renewable and sustainable local resources. Indonesia is an agricultural and maritime country so these two aspects should be the core of the growth. In agricultural culture, plantation sector is the source of sustainable economic growth because of its geographical, demographic, and cultural potentials. The problems in plantation sector are the low growth of areas and productivity as well as its limited end-products. The research findings indicated that in order to increase areas, there should be a guarantee on investment, interest rate, and little retribution or good governance. To increase productivity, we need a guarantee on fertilizer price, interest rate, and wages, as well as pricing factors to avoid market distortion. This is very important relating to the economic stimulus policy which is essential to revitalize from the economic doom in the future. Keywords: plantation sector, area, productivity, investment, interest rate, and wages