Jokowi says tensions in Korean peninsula add to economic jitters

Indonesian President Joko Widodo said rising tensions between North Korea and South Korea are among factors that have triggered global market jitters and added to economic uncertainty.

As the rupiah is fast approaching the lowest levels seen during the 1998 Asian financial crisis and stock prices tumbled, Joko said Indonesia was not alone in facing an economic downturn.

“Our neighbouring countries are experiencing the same things, caused by the US Fed rate hike, the crisis in Greece a few months ago, and the tensions between North Korea and South Korea,” Joko was quoted as saying in a press release issued by the Cabinet Secretary.

Joko was speaking to governors, top prosecutors and regional police chiefs at the Bogor Palace on Monday as part of efforts to stave off a crisis as the rupiah continued to slide even deeper to its worst since July 1998, hitting 14,000 to the dollar on Monday.

He urged the officials to obey the line of command on what they have to do to tackle the economic slowdown.

“We have an established command chain. Don’t go beyond the established line [of command],” Joko said.

The Indonesian government has said that it was following closely the latest development in the Korean peninsula and called on both sides to exercise utmost restraint, in view of the recent exchange of fires and military tensions at the Demilitarized Zone (DMZ) on August 20.

“Indonesia emphasises the importance of reducing tensions and maintaining conditions conducive for peace, stability and development in both countries and the region,” the statement said as issued by the foreign ministry.

“In this regard, Indonesia calls for the immediate resumption of dialogue mechanisms as well as other non-traditional initiatives to intensify communication between the DPRK and the ROK,” it said, using the official initials of the two Koreas.

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