Business players expect to resume operations as usual around September or October as businesses are paralyzed and lay off workers in coping with economic shocks from the COVID-19 pandemic.
Indonesian Chamber of Commerce and Industry (Kadin) chairman Rosan Roeslani told The Jakarta Post that business players expected the coronavirus pandemic to peak around June, with the number of patients reaching new heights, before seeing major improvement in September.
“However, the economic recovery from the pandemic would last until 2021 or even the next two years,” he said on Monday. The long rebound period would be especially true for industries most hit by the pandemic such as tourism.
Scientists have predicted that the peak of the coronavirus spread in the country will be around April with around 71,000 cases, as the government accelerates rapid tests to contain the virus. COVID-19 cases in Indonesia had reached 2,491 and 209 deaths as of Monday, among the highest death rates in the world, half of which are in Jakarta.
As President Joko “Jokowi” Widodo announced a public health emergency, with a large scale social distancing policy, some manufacturers have stopped production such as carmakers Suzuki Indonesia and Honda Indonesia. More than 16,000 employees in the capital city have been laid off or had to take unpaid leave as companies grapple with the effect of the coronavirus.
Thousands of employees in hard hit Bali have been as tourism collapsed on the island of the gods.
“What businesses can do right now is to maintain liquidity and cash flow,” said Rosan. “Halt nonessential spending to avoid layoffs. What’s important now is to be able to survive during this pandemic.”
MSMEs Association (Akumindo) chairman Ikhsan Ingratubun said the government needed to prepare stimulus for small businesses that employ daily workers most vulnerable from economic shocks. At 70.49 million people, more than half of Indonesia’s workforce are informal workers with minimum or no social safety net at all.
“I ask for relaxation on electricity and water. We don’t have any income. My business closed down, I don’t know how to pay for the holiday bonus (THR),” said Ikhsan, who owns a restaurant chain. “Without a proper policy there will be a social and security threat.”
A recent survey by the Mobile Marketing Association (MMA) and SurveySensum echoes Kadin’s projection, finding that business players expect the situation to normalize within the next five months, or around August.
The survey further stated that the COVID-19 pandemic has brought down the revenue of businesses, with 76 percent of the respondents saying the pandemic had “severely disturbed business’ daily activities.”