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CNA
02-05-2025
- Business
- CNA
US wants Indonesia to undo trade barriers amid tariff threat, but Jakarta should stand firm: Analysts
JAKARTA: Indonesia should stand firm against the United States' recent demands to remove a broad suite of trade practices Washington considers unfair, experts said, arguing that some of these policies are needed to protect Southeast Asia's largest economy's national interests. These so-called 'trade barriers' were identified in a report by the US Trade Representative (USTR) on Mar 31 detailing factors hindering US companies from entering the Indonesian market. The 2025 National Trade Estimate (NTE) Report on Foreign Trade Barriers has been used as one of the basis for US President Donald Trump to impose a planned 32 per cent tariff on Indonesian goods. The USTR is leading the technical negotiations with various countries including Indonesia amid the tariff threat. Among the barriers mentioned by the report are lax protection of copyright laws, rampant corruption and overly complicated bureaucracy which have been cause for concerns for many companies operating in Indonesia, US-owned or otherwise. However, experts noted that the USTR list includes policies which should not be considered trade barriers. These include Indonesia's efforts to develop its own cashless payment system and those which Indonesia needs to protect its own national interests such as import quotas and requirements to have some components produced locally before a product can be sold in Indonesia. 'We need some of these policies to protect our own manufacturing sector, spur investment and to stimulate our economy. It will be unreasonable for Indonesia to meet all these demands (from the US),' Tauhid Ahmad, an economist from Jakarta-based think-tank Institute for Development of Economics and Finance (INDEF) told CNA. Without these policies, the archipelago could risk losing massive amounts of foreign investment, higher unemployment and even a recession, warn experts. Over the last two weeks, several senior Indonesian officials have met with their US counterparts at the sideline of an International Monetary Fund and World Bank Group summit in Washington DC, to negotiate the proposed 32 per cent tariffs the US wants to impose on Indonesia. These tariffs have been put on hold for 90 days since Apr 9, along with other 'reciprocal' tariffs on imports from almost 60 countries. The 10 per cent baseline tariff on all countries is still in place. Coordinating minister for economy, Airlangga Hartarto who led the Indonesian delegation, said that Indonesia is willing to negotiate these trade barriers on top of buying billions of dollars worth of US products, in exchange for a lower tariff. 'In principle, what Indonesia is offering… is appreciated by America,' Airlangga told reporters on Monday. The minister refused to elaborate further but promised that any agreement between the two countries would be a 'win-win solution'. When Indonesia became one of more than 180 countries and territories targetedby Trump's reciprocal tariffs on Apr 2, Southeast Asia's biggest economy responded by vowing not to retaliate and instead, import more goods from the US to balance Indonesia's trade surplus. As negotiations continued, experts said it appeared that the Trump administration wanted more and urged Indonesia to also remove what the US considered to be 'trade barriers'. 'These trade barriers have been identified in previous USTR reports, long before Trump became president. The difference is this time the US is using the threat of tariffs to get what they want: the elimination of all these barriers for American goods,' Tauhid of INDEF said. The tariff plan has already sparked fear of a potential recession, leading the Indonesian stock market to drop by nine per cent on Apr 8, its first trading day after the Idul Fitri holiday period. The World Bank last week slashed Indonesia's growth forecast from 5.1 per cent to 4.7 per cent this year. Indonesia's Finance Ministry however is confident that the country can still grow by 5 per cent this year, although the figure is lower than Indonesia's economic growth target of 5.2 per cent. SOME REQUIREMENTS RELAXED Part of the reason why Trump is threatening to impose a 32 per cent tariff on Indonesian goods is that the US is buying more from Indonesia than the other way around. Last year, Indonesia exported US$28.1 billion worth of electrical appliances, clothes, furniture and other products to the US, a 4.8 per cent rise from 2023. Conversely, US exports' to Indonesia amounted to US$10.2 billion, up 3.7 per cent from 2023. This means that from 2023 to 2024, the US' trade deficit with Indonesia has grown by 5.4 per cent from US$16.9 billion to US$17.9 billion. Indonesian President Prabowo Subianto said the country is prepared to be flexible about its local content requirement policy, which the USTR has identified as a trade barrier. The policy, known as TKDN, requires a product to have a certain percentage of components produced locally before it can be sold in the Indonesian market. 'We have to be realistic. If we force TKDN (to be applied), in the end, we will lose a competitive advantage. TKDN needs to be flexible or perhaps replaced with incentives,' Prabowo said on Apr 9, a week after Trump announced his tariffs. The TKDN requirement was one of the reasons why tech giant Apple could not sell its iPhone 16 in Indonesia after its launch in October last year. The ban was lifted in March when Apple finally met the 40 per cent local component requirement set by Jakarta and agreed to build two Apple accessory factories in Indonesia. Experts lambasted Prabowo's statement, saying that although so far it has yet resulted in any amendments to the requirement, the comment was enough to dissuade several investors from putting their money in Indonesia. 'Some investors are waiting to see what Indonesia is going to do next. If Indonesia really scraps the TKDN requirement as the US had wanted, what is the point of opening up a factory (in Indonesia) to produce local components?' Bhima Yudhistira, executive director of the Center of Economic and Law Studies (CELIOS), another Jakarta-based think tank, told CNA. Experts have also defended Indonesia's decision to develop its own QR Code-based payment gateway, QRIS, which allows consumers to pay with their phones instead of debit or credit cards. As more and more Indonesians prefer the QRIS over cards issued by Visa or Mastercard, both American multinational payment cards, the USTR listed the payment system as a trade barrier. According to the US agency, US companies 'were not ... invited to share views on how the system might interact with existing global payment frameworks'. According to Bank Indonesia, there were more than 2.6 billion rupiah (US$156,681) worth of transactions using the QRIS system in the first three months of 2025, a 170 per cent growth compared to the same period last year. Bank Indonesia's Senior Deputy Governor Destry Damayanti said the central bank is open to working with any country, including the US, on QRIS or other fast payment technologies. 'Visa and Mastercard are still major players in our credit card space, so really, there's no issue,' she said last week as quoted by the Jakarta Globe. On Monday, Airlangga confirmed that some trade barriers identified by USTR will either be relaxed or eliminated entirely, but did not say which ones. The minister said over the next 60 days, there will be more meetings between the US and Indonesia over the matter. RISK OF OPENING A FLOODGATE Indonesia is also looking to increase its import of American products. Airlangga said his country is prepared to bring this year's imports from the US to US$18.5 billion, a significant increase from last year's US$10.2 billion. The minister said Indonesia is also ready to provide incentives so that some American products are sold more competitively in Indonesia. Bhima of CELIOS said Indonesia does not need to relax its non-tariff trade barriers, arguing that the offer to increase imports has been generous enough. 'Trump has time and time again argued that the tariffs are about overcoming the US trade deficit with other countries and Indonesia is offering to close that deficit,' he said, adding that relaxing some of Indonesia's protectionist policies like import quotas or the local component requirements could open a floodgate of foreign products. 'Because of the trade war, every country is looking to dump products which they cannot sell to the US. If we open some of these trade barriers, Indonesia will be flooded with foreign goods and our manufacturing sector will suffer,' Bhima said. Yusuf Rendy Manilet, an economist from think tank, Center of Reform on Economics (CORE) said Indonesia could relax some quotas and requirements on certain products. 'Especially commodities that we cannot produce ourselves but the US has a lot of like wheat or soy,' he said. 'The bottom line is we should not be hasty about opening up our import quota or other non-tariff trade barriers.' Yusuf said that other wheat and soy-producing countries might want to make sure Indonesia keeps buying their commodities over the US. 'We can use that to our advantage, particularly to diversify the market for our own products,' he added. Minister Airlangga said Indonesia is currently in talks with many countries on how they can cooperate amid the ongoing trade war. 'At the same time, we need to address the more legitimate concerns the USTR had like the lack of copyright protection which led to the proliferation of pirated software developed by US tech companies,' Yusuf said. For 13 years in a row, Indonesia has been on USTR's Priority Watch List with respect to intellectual property protection and enforcement. The US agency wrote in its March report that pirated software, fake apparel and other counterfeited goods are being sold in the open with 'little or no enforcement actions.' Even when law enforcers decide to take action, producers and sellers of counterfeit goods are rarely prosecuted in court. Bhima of CELIOS said Indonesia also needs to streamline bureaucracy and stamp out corruption. 'We need to show that for the more reasonable concerns raised by the USTR, we are addressing them seriously,' he said. Indonesia also needs to remind Trump that Indonesia has been a very good friend of the US, said some experts.
CNA
29-04-2025
- Business
- CNA
Soaring prices, overnight queues: Economic uncertainty and US tariff war fuel Indonesia's gold fever
JAKARTA: When Resty Kinanthi arrived at a gold shop in South Jakarta at 8am on a recent weekday eager to buy a few grams of the precious metal, she was quickly turned away. The 24-year-old, who is currently unemployed, had heard of the growing gold trend gripping the country in recent weeks so she turned up early, an hour before the shop opened. Still, she was too late. A 50-person quota had been in place to buy gold since April and it was already full. She went back the following day at 6am at sunrise but it was the same story. 'I wondered: Why? At what time do people even arrive? I asked around and was told that a lot of people came the night before to get a number to queue for the quota,' she said. With gold hitting an all-time high, an economic slowdown in Indonesia, and concerns about how United States President Donald Trump's tariffs will affect the world's economy, many Indonesians have been rushing to buy gold, even if it means queuing the night before the shop opens. While gold fever has happened before in the country, most recently during the COVID-19 pandemic, the current craze has reached new heights, say experts, as they remind consumers to be cautious of the volatile economic situation. WHY ARE PEOPLE QUEUING? In Indonesia, the queue to buy gold began slowly months ago when Trump was about to return to power, said economist Eko Listiyanto from the Institute for Development of Economics and Finance (INDEF). But it has intensified in recent weeks after Trump's tariff announcement. The US announced a 32 per cent tariff on imported Indonesian goods on Apr 2, which Trump declared 'Liberation Day' due to the sweeping group of tariff announcements on various countries, before declaring a 90-day-pause on Apr 9 on 'reciprocal' tariffs on imports from almost 60 countries. After Liberation Day, the gold price globally and in Indonesia soared as it is widely seen as a safe haven hedge against the economic uncertainties caused by Trump's moves. As of Apr 28, the global price of gold is about US$3,338 per ounce (around 28 grams), while in Indonesia it was 1.965 million rupiah (US$117) per gram. This is about a 10 per cent increase compared to one month ago when it was 1.79 million rupiah. Other countries in the region have also reported seeing symptoms of gold fever. In Malaysia, some stores reported a 25 per cent increase in customers, according to local media. Vietnam has also reported long queues outside stores to buy gold. In Thailand, where gold also retains strong cultural significance, younger generations are entering the market through social media-driven financial advice. As a result, gold-trading apps and platforms are flourishing. There were however no reports of people queuing overnight in these countries as seen in Indonesia. While some people in Indonesia may understand that the high gold price is related to Trump's Liberation Day, others may not, said Eko. He added that as the cost of living in Indonesia has also gone up, people want to prepare for rainy days. Furthermore, some people may still have money left from their Eid religious allowance, which employers handed to their staff towards the end of March, and they think it's best to spend it on gold. Eko said that many who queue for gold lately are young people such as Resty, and the high demand may be because Gen Z and millennials are financially more literate than older generations in Indonesia. 'Gen Z and millennials may not have a lot of money, but they are starting to invest earlier than previous generations,' Eko added. He also said that because the two generations are digitally connected, they tend to have a heightened fear of missing out (FOMO). Economist Fithra Faisal from securities brokerage firm Samuel Sekuritas Indonesia shared the same view. He also said that because many Indonesians live from paycheck to paycheck, they want to gain an advantage from the current situation, as a hike in gold price seems like an easy way for them to buy and then resell quickly to profit. 'Because there is the potential that the gold price will increase further - three weeks ago it was 1.7 million rupiah per gram, then 1.8 million rupiah, then 1.9 million, then 2 million, they want to benefit from it.' A LONG-STANDING STATUS SYMBOL Besides gen Z and millennials, some who queue are women from older generations. Fithra said that these women from lower-income groups may not have a bank account, and their way to save up is by buying gold. Social researcher Devie Rahmawati from the University of Indonesia said that, generally, gold has played a crucial role in Indonesian society for a long time. In many Indonesian cultures, older generations grew up being told to have gold, not just as an investment, but also as a symbol of social status. 'Gold is a symbol of prosperity, power, and happiness,' said Devie. 'This is perhaps nowadays replaced by the cars people use or their mobile phones, but the older generation, especially women, tend to have gold and even pass theirs down to the next generation.' However, places to purchase gold are limited. In Southeast Asia's largest economy, gold bullion - gold in the form of bars or coins - is mainly sold by the state-owned mining company Aneka Tambang (ANTAM), which has only a few shops in Jakarta and a few other major cities in Indonesia. There are only a handful of smaller ones, and most people prefer gold of ANTAM as the London Bullion Market Association guarantees it and it is easier to resell. With not many options for people to buy bullion gold in its physical form exist, ANTAM could struggle to meet the demand, said observers. 'ANTAM cannot just suddenly increase its production,' said Eko. 'This makes the queues long.' ANTAM told CNA it aims to make the metal available as much as possible. It currently has five outlets in Jakarta and about 15 nationwide. "We have anticipated this condition by strengthening the supply chain and optimising our distribution network, including our boutiques in various regions, and also presenting a digital solution for purchasing gold through ANTAM's application," said ANTAM corporate secretary Faisal Alkadrie. While acknowledging the increase in gold demand, he did not reveal figures on this as well as on how much ANTAM sells daily. Economist Eko also said that the situation in Indonesia could be the same in regions with similar cultural attitudes towards gold and economic conditions, citing India as an example. However, Fithra from Samuel Sekuritas Indonesia said that people are probably not queuing overnight to buy gold in developed countries, where it is often bought digitally, and stored in an account. STAYING OVERNIGHT Undeterred by her two failures, Resty went to the same ANTAM boutique for the third time on Apr 22, this time at 9pm. When she arrived, there were already other hopeful buyers. She discovered that a system had been put in place in the name of fairness: They all list their name down on a piece of paper in order of who arrives first, and treat it as an unofficial attendance list. When the security officer arrived at 7am the next day he created an official list and handed out a number for them to queue, according to the quota set for that day. That list is based on the unofficial attendance list, but the officer will first check to see if the person is still there. Since some live far away or are afraid that their names will be skipped, they opt to spend the night at ANTAM, staying awake all night or sleeping in a sitting position. When Resty arrived that evening, she was number 19 on the unofficial attendance list. She decided to stay at the closed shop until past midnight, afraid that someone would delete her name, and then went home, returning at 4am. When the security officer arrived in the morning and created an official attendance list, she was thrilled to find out she got number 17, as two people were not present. Resty, who previously worked as a social media administrator, said gold is the easiest form of investment because it doesn't require much comprehension, unlike buying stocks. 'The current inflation is telling me that I need to invest. Nobody told me to do this (buy gold). '(But) At the moment, there is a trade war between one country and another, which is likely to increase inflation and weaken the currency (rupiah),' said Resty, referring to the trade tensions between the US and China. She had bought gold for the very first time eight months before, at about 1.4 million rupiah for one gram. On the day CNA interviewed her, ANTAM sold one gram of gold at 1.995 million rupiah. Resty bought two bullion gold bars, each weighing five grams. Online clothes seller Nina Ramdayani, 30, had already bought gold on Apr 22 but went again the next day because she wanted to have as much gold as possible. She arrived at 10pm the night before and stayed at ANTAM all night. She managed to buy three gold bullions of 25 grams each on her second day, whereas the day before, the only ones left for her to buy were three gold bullions of 10 grams. 'I am happy. My attempt to wait all night long has paid off,' she told CNA in a sleepy voice after just getting hold of the gold. Nina returned to the same ANTAM boutique on Apr 24, for the third time and again bought three gold bullions of 10 grams. Some rush to buy gold with the aim of reselling it, such as Achmad Faathir, who is based in Sukabumi, West Java. Since his wage as a translator has been recently slashed, Achmad wanted to sell the three-gram gold bullion he bought in 2021 as the price is currently high and he needs the money. Sukabumi has no ANTAM shop, and since Achmad happened to be in Jakarta for personal matters, the stars aligned for him to resell his gold. Achmad arrived at 8am on Apr 23 and got number six. 'If I resell at a (jewellery) gold shop (in Sukabumi), the difference could be up to 100 thousand rupiah,' he said. PROS AND CONS OF THE GOLD RUSH The gold craze is likely to continue as long as the gold price rises and the global economic outlook remains uncertain, economists said. 'If the global economy remains uncertain, gold prices will remain high,' said economist Fithra. Veronica Kaihatu, a psychology lecturer at Pembangunan Jaya University in South Tangerang, said gold will remain a favourite metal among Indonesians due to cultural perceptions but the gold craze will likely decrease when people feel more secure about the economy. 'So this depends on social, political and economic conditions.' Social researcher Devie from the University of Indonesia said that the gold madness provides a form of financial security. Should one decide to buy gold jewellery, especially if one is unable to purchase bullion, then it is also good since it can be worn. However, she said people should know where to save the gold because it is not safe in Indonesian homes, which are prone to disasters such as flooding and theft. 'Do you have a safe deposit box at the bank? If yes, put it there, not at home,' she said. Financial planner Mike Rini from financial consultant Mitra Rencana Edukasi said all investment forms have their risks, including gold. She said gold could be a good investment tool if the price is not volatile. 'Even though in the long term gold price tends to go up, it could also be volatile, going up and down between days. 'So to me it is good when it is meant for the long term,' said Mike. 'It is not meant to generate passive regular income.'
CNA
29-04-2025
- Business
- CNA
Soaring prices, overnight queues: Economic uncertainty and US tariffs fuel Indonesia's gold fever
JAKARTA: When Resty Kinanthi arrived at a gold shop in South Jakarta at 8am on a recent weekday eager to buy a few grams of the precious metal, she was quickly turned away. The 24-year-old, who is currently unemployed, had heard of the growing gold trend gripping the country in recent weeks so she turned up early, an hour before the shop opened. Still, she was too late. A 50-person quota had been in place to buy gold since April and it was already full. She went back the following day at 6am at sunrise but it was the same story. 'I wondered: Why? At what time do people even arrive? I asked around and was told that a lot of people came the night before to get a number to queue for the quota,' she said. With gold hitting an all-time high, an economic slowdown in Indonesia, and concerns about how United States President Donald Trump's tariffs will affect the world's economy, many Indonesians have been rushing to buy gold, even if it means queuing the night before the shop opens. While gold fever has happened before in the country, most recently during the COVID-19 pandemic, the current craze has reached new heights, say experts, as they remind consumers to be cautious of the volatile economic situation. WHY ARE PEOPLE QUEUING? In Indonesia, the queue to buy gold began slowly months ago when Trump was about to return to power, said economist Eko Listiyanto from the Institute for Development of Economics and Finance (INDEF). But it has intensified in recent weeks after Trump's tariff announcement. The US announced a 32 per cent tariff on imported Indonesian goods on Apr 2, which Trump declared 'Liberation Day' due to the sweeping group of tariff announcements on various countries, before declaring a 90-day-pause on Apr 9 on 'reciprocal' tariffs on imports from almost 60 countries. After Liberation Day, the gold price in Indonesia soared. As of Apr 28, the global price of gold is about US$3,338 per ounce (around 28 grams), while in Indonesia it was 1.965 million rupiah (US$117) per gram. The demand for gold has also increased amid Trump's Liberation Day, as it creates uncertainties and people are worried that the economy will be bad and prices will rise. Gold is generally seen as a safe haven that can weather bad situations. Other countries in the region have also reported seeing symptoms of gold fever. In Malaysia, some stores reported a 25 per cent increase in customers, according to local media. Vietnam has also reported long queues outside stores to buy gold. In Thailand, where gold also retains strong cultural significance, younger generations are entering the market through social media-driven financial advice. As a result, gold-trading apps and platforms are flourishing. There were however no reports of people queuing overnight in these countries as seen in Indonesia. A LONG-STANDING STATUS SYMBOL Besides gen Z and millennials, some who queue are women from older generations. Fithra said that these women from lower-income groups may not have a bank account, and their way to save up is by buying gold. Social researcher Devie Rahmawati from the University of Indonesia said that, generally, gold has played a crucial role in Indonesian society for a long time. In many Indonesian cultures, older generations grew up being told to have gold, not just as an investment, but also as a symbol of social status. 'Gold is a symbol of prosperity, power, and happiness,' said Devie. 'This is perhaps nowadays replaced by the cars people use or their mobile phones, but the older generation, especially women, tend to have gold and even pass theirs down to the next generation.' However, places to purchase gold are limited. In Southeast Asia's largest economy, gold bullion - gold in the form of bars or coins - is mainly sold by the state-owned mining company Aneka Tambang (ANTAM), which has only a few shops in Jakarta and a few other major cities in Indonesia. There are only a handful of smaller ones, and most people prefer gold of ANTAM as the London Bullion Market Association guarantees it and it is easier to resell. With not many options for people to buy bullion gold in its physical form exist, ANTAM could struggle to meet the demand, said observers. 'ANTAM cannot just suddenly increase its production,' said Eko. 'This makes the queues long.' ANTAM told CNA it aims to make the metal available as much as possible. It currently has five outlets in Jakarta and about 15 nationwide. "We have anticipated this condition by strengthening the supply chain and optimising our distribution network, including our boutiques in various regions, and also presenting a digital solution for purchasing gold through ANTAM's application," said ANTAM corporate secretary Faisal Alkadrie. While acknowledging the increase in gold demand, he did not reveal figures on this as well as on how much ANTAM sells daily. Economist Eko also said that the situation in Indonesia could be the same in regions with similar cultural attitudes towards gold and economic conditions, citing India as an example. However, Fithra from Samuel Sekuritas Indonesia said that people are probably not queuing overnight to buy gold in developed countries, where it is often bought digitally, and stored in an account. STAYING OVERNIGHT Undeterred by her two failures, Resty went to the same ANTAM boutique for the third time on Apr 22, this time at 9pm. When she arrived, there were already other hopeful buyers. She discovered that a system had been put in place in the name of fairness: They all list their name down on a piece of paper in order of who arrives first, and treat it as an unofficial attendance list. When the security officer arrived at 7am the next day he created an official list and handed out a number for them to queue, according to the quota set for that day. That list is based on the unofficial attendance list, but the officer will first check to see if the person is still there. Since some live far away or are afraid that their names will be skipped, they opt to spend the night at ANTAM, staying awake all night or sleeping in a sitting position. When Resty arrived that evening, she was number 19 on the unofficial attendance list. She decided to stay at the closed shop until past midnight, afraid that someone would delete her name, and then went home, returning at 4am. When the security officer arrived in the morning and created an official attendance list, she was thrilled to find out she got number 17, as two people were not present. Resty, who previously worked as a social media administrator, said gold is the easiest form of investment because it doesn't require much comprehension, unlike buying stocks. 'The current inflation is telling me that I need to invest. Nobody told me to do this (buy gold). '(But) At the moment, there is a trade war between one country and another, which is likely to increase inflation and weaken the currency (rupiah),' said Resty, referring to the trade tensions between the US and China. She had bought gold for the very first time eight months before, at about 1.4 million rupiah for one gram. On the day CNA interviewed her, ANTAM sold 1 gram of gold at 1.995 million rupiah. Resty bought two bullion gold bars, each weighing five grams. Online clothes seller Nina Ramdayani, 30, had already bought gold on Apr 22 but went again the next day because she wanted to have as much gold as possible. She arrived at 10pm the night before and stayed at ANTAM all night. She managed to buy three gold bullions of 25 grams each on her second day, whereas the day before, the only ones left for her to buy were three gold bullions of 10 grams. 'I am happy. My attempt to wait all night long has paid off,' she told CNA in a sleepy voice after just getting hold of the gold. Nina returned to the same ANTAM boutique on Apr 24, for the third time and again bought three gold bullions of 10 grams. Some rush to buy gold with the aim of reselling it, such as Achmad Faathir, who is based in Sukabumi, West Java. Since his wage as a translator has been recently slashed, Achmad wanted to sell the three-gram gold bullion he bought in 2021 as the price is currently high and he needs the money. Sukabumi has no ANTAM shop, and since Achmad happened to be in Jakarta for personal matters, the stars aligned for him to resell his gold. Achmad arrived at 8am on Apr 23 and got number six. 'If I resell at a (jewellery) gold shop (in Sukabumi), the difference could be up to 100 thousand rupiah,' he said. PROS AND CONS OF THE GOLD RUSH The gold craze is likely to continue as long as the gold price rises and the global economy remains uncertain, economists said. 'If the global economy remains uncertain, gold prices will remain high,' said economist Fithra. Veronica Kaihatu, a psychology lecturer at Pembangunan Jaya University in South Tangerang, said gold will remain a favourite metal among Indonesians due to cultural perceptions but the gold craze will likely decrease when people feel safe. 'So this depends on social, political and economic conditions.' Social researcher Devie from the University of Indonesia said that the gold madness provides a form of financial security. Should one decide to buy gold jewellery, especially if one is unable to purchase bullion, then it is also good since it can be worn. However, she said people should know where to save the gold because it is not safe in Indonesian homes, which are prone to disasters such as flooding and theft. 'Do you have a safe deposit box at the bank? If yes, put it there, not at home,' she said. Financial planner Mike Rini from financial consultant Mitra Rencana Edukasi said all investment forms have their risks, including gold. She said gold could be a good investment tool if the price is not volatile. 'Even though in the long term gold price tends to go up, it could also be volatile, going up and down between days. 'So to me it is good when it is meant for the long term,' said Mike. 'It is not meant to generate passive regular income.'
