Question

Under the leadership of Suharto, the Indonesian economy grew at a steady pace. Why was this ultimately not sustainable?

Answer 1

Solution:

Under the Leadership of Suharto ,the Indonesian economy grew at a steady pace : -

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Indonesia economic condition had arrived at an alarmingly terrible condition.The economy experienced the chaotic political course set out by president soekarno ,Indonesia's first president.

Financial issues took a back seat for soekarno who had invested a real existence or life time battling in the political field.

A few examples of his policies that adversely influenced the economy were removing his connections with the west (in this way secluding Indonesia from the world economy cutting off connections world's economy and banishing nation from accepting genuinely necessary remote or foreign and cash ) and deficiency going through the printing of money bringing about a out-of-hand hyperinflation .But in after Suharto took over from Soekarno in the mid - 1960 ,financial strategies or financial policies experienced an extreme change obviously.

The essential mission of Suharto's new order government was financial development,initial step being reintegration of Indonesia back to the world economy by rejoining the International Monetary  Fund(IMF).

This empowered the public sector to assume a more prominent role in the economy by embraced considerable public investments in territorial or regional development and social improvement ,infrastructure and through establishment of huge scale ventures ,capital goods and crude materials or raw materials.