Bisnis.comJAKARTA — Indonesia as G20 Presidency believes that food insecurity and high energy prices will create a “great storm” of risk for developing countries. The G20 elite must play a role in anticipating these risks.

This was transmitted by the Minister of Finance Sri Mulyani Indrawati in his interview with Bloomberg News in Washington DC, United States of America. He attended a series of IMF and G20 meetings in Uncle Sam’s country ahead of the G20 summit in Bali.

Sri Mulyani said the current difficult economic conditions could be bleaker next year. Growing food insecurity and high energy prices have left many countries in limbo.

These challenges are compounded by the surge in inflation, the appreciation of the US dollar exchange rate and the upward trend in interest rates.

Harsh conditions will occur globally, he said, but the pressure is greater for developing countries.

“The storm must be very strong… It will put many developing and developing countries in a very serious and difficult situation,” Sri Mulyani said as quoted by Bloomberg on Wednesday (12/10/2022).

According to him, the Fed’s decision to aggressively raise interest rates is aimed at controlling inflation and maintaining central bank credibility.

However, this policy has adverse consequences for developing countries and will make it difficult for them to issue bonds.

Sri Mulyani said about 15 developing countries have US dollar-denominated government bonds that pay at least 1,000 basis points more than the US Treasury.

The number of countries has doubled from its initial position in 2022.

He also considered that the food crisis is a great risk that haunts developing countries.

“Those who cannot get sufficient stock of fertilizer will face food shortages in six months,” he added.

Sri Mulyani underscored the importance of Indonesia’s role as the G20 chairmanship in inviting member countries, especially Russia, to overcome various problems. Indonesia will also urge the G7 to take action to address global issues.

“The real value of the G20 forum is that whatever happens today, the world will need this kind of cooperation. And an inaugural economic forum like the G20 deserves to be continued, maintained and preserved,” he said. said Sri Mulyani.

On Wednesday (10/12/2022), Washington DC time, Sri Mulyani will chair the fourth meeting of G20 Finance Ministers and Central Bank Governors this year.

He is responsible for addressing various topics and resolving global economic issues.

At a meeting of G20 finance ministers and central bank governors in Bali in April 2022, officials from the United States, Canada and several European countries left the room when Russian representatives began speaking.

This has increased the tension in the discussions of the G20 countries in an effort to find solutions to current economic problems.

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