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Monday, April 13, 2009

Economist: Fiscal stimulus always benefit big capital

Jakarta (ANTARA News) - An economist said fiscal stimulus packages would in a proportionate way always benefit big capital owners engaged in any kind of economic activity.

"Fiscal stimulus packages will always benefit those with big capital in any economic activity proportionately, This is something unavoidable," economist Tony Prasentiantono said here Monday.

He made the statement when asked to comment on the recent statement of the chairman of the board of patrons of Gerindra Party, Prabowo Subianto, that economic stimulus packages would only benefit and be enjoyed by big businesses rather than the common people.

Tony who is also chief economist of state-owned bank BNI said that basically his statement was general in nature.

Quoting an example he said "when the national budget expands it will be contractors, suppliers and companies working for the government that benefit."

He said other parties also enjoyed it in the form of project spillovers such as construction workers. Basically, a lot of parties collectively get its benefit, he said.

"It is indeed unavoidable that investors, contractors and suppliers will get more benefit while others such as laborers and others will only enjoy the spillover," he said.

He said the parties concerned would get an advantage proportionately, in other words not all parties would get equal advatages, adding that this was an economic axiom.

"What is important is increasing its trickle-down effect as much as possible," he said.

He said the government had asked contractors to use locally-produced raw materials
as much as possible so that the multiplier effect of the policy could be enjoyed by the people in the country to drive economy.

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