Jakarta. Investment Minister Rosan Roeslani dismissed concerns that the government’s new natural resource export governance policy is the main driver behind the recent selloff in Indonesian stocks, arguing that the market pressure stems more from external and technical factors than weakening economic fundamentals.

Rosan said the public should assess the policy comprehensively, including its potential benefits for the domestic economy. He referred to earlier explanations from Finance Minister Purbaya Yudhi Sadewa and Chief of  Economic Affairs Minister Airlangga Hartarto regarding the objective of the new export governance framework.

“The main point we should look at is what the finance minister and Bank Indonesia governor have conveyed regarding the positive benefits of the new natural resource export governance policy,” Rosan said at the Coordinating Economic Ministry office in Jakarta on Thursday.

According to Rosan, the policy is aimed at strengthening the country’s economic foundation by improving transparency in natural resource commodity export transactions.

He added that the recent market downturn was also influenced by external pressures, including MSCI’s index rebalancing process, which is expected to continue until the end of the month.

The issue has fueled foreign investor movements in several domestic stocks, putting additional pressure on the Jakarta Composite Index.

Still, Rosan urged investors not to focus solely on short-term market volatility, saying Indonesia’s economic fundamentals remain solid and capable of supporting the capital market going forward.

He argued that the recent market weakness is largely driven by temporary technical factors and investor perception rather than any deterioration in the country’s underlying economy.

Add as a preferred source on Google +