1. THE COMPILATION OF FLOW OF FUNDS STATISTICS IN INDONESIA Paris, October 24-27 th 2011 Hendy Sulistiowaty Eko Ariantoro Contributed to the Discussion of Working Party on Financial Statistics (WPFS) Meeting and Workshop on the Implementation of the SNA 2008

2. -2- O U T L I N E

3. -3- BASIC CONCEPT OF FOF CONSTRUCTION

4. -4- FLOW OF FUNDS is a data system which is designed to describe net lending and net borrowing among institutional sectors, and financial transaction activities using various financial instruments. Indonesian FOF is constructed in the form of matrix system.  The column side represents institutional sectors, which divided into 2 columns: Financial Uses (assets) and Financial Sources (liabilities).  The row side is divided into 2 rows, ie. above the line and below the line, which are separated by a row of the net lending/borrowing transaction.  Above the line of FOF’s row constitutes Saving and Non-Financial Investment (Gross Fixed Capital Formation).  Below the line of FOF’s row comprises various instruments of financial investment. Indonesian FOF statistics has been compiled by Statistics Indonesia (BPS) coordinating with Bank Indonesia and Ministry of Finance. FOF data have been available annualy (8 sectors) since 1984, and quarterly (5 sectors) since 2000. THE INDONESIAN FOF STATISTICS

5. -5- BASIC FRAMEWORK OF INDONESIAN FOF

6. -6- COVERAGE OF INSTITUTIONAL SECTORS

7. -7- COVERAGE OF FINANCIAL INSTRUMENTS … (1)

8. -8- COVERAGE OF FINANCIAL INSTRUMENTS … (2)

9. -9- COVERAGE OF FINANCIAL INSTRUMENTS … (3)

10. -10- FINANCIAL DATA COVERAGE: Australia FOF Accounts

11. -11- FINANCIAL DATA COVERAGE: US FOF Accounts

12. -12- FOF DATA COVERAGE: MFSM Based Financial Instruments

13. -13- DATA SOURCES AVAILABILITY

14. COMPILATION PROCESS OF INDONESIAN FOF -14-

15. -15- QUARTERLY INDONESIAN FOF, Q1 2011 *) *) Preliminary Figure Trillion Rp

16. -16- PAGE 1 ANNUALY INDONESIAN FOF, 2009 Trillion Rp

17. -17- PAGE 2 Trillion Rp ANNUALY INDONESIAN FOF, 2009

18. -18- Foreign loan to Business & HH Rp16,0 T Foreign Inv in Business & HH Rp23,2 T Selling stocks by Foreign Rp24,0 T Increase in SBI/SBIS of Banks Rp5,8 T Increase in Term Deposit Rp28,3 T Increase in Rupiah DD Rp15,5 T Increase in Forex DD Rp16,1 T Decrease in Currencies in Banks Rp9,5 T BUSINESS & HOUSEHOLDS Goss Saving Rp449,2 T Non Fin. Inv Rp548,2 T Net Borrowing Rp99,0 T BUSINESS & HOUSEHOLDS Goss Saving Rp449,2 T Non Fin. Inv Rp548,2 T Net Borrowing Rp99,0 T BANKS Gross Saving Rp21,5 T Non Fin. Inv Rp1,2 T Net Lending Rp20,3 T BANKS Gross Saving Rp21,5 T Non Fin. Inv Rp1,2 T Net Lending Rp20,3 T CENTRAL BANK Gross Saving -Rp5,8 T Non Fin. Inv -Rp38,3 M Net Borrowing Rp5,8 T CENTRAL BANK Gross Saving -Rp5,8 T Non Fin. Inv -Rp38,3 M Net Borrowing Rp5,8 T GOVERNMENT Gross Saving Rp75,1 T Non Fin. Inv Rp9,0 T Net Lending Rp66,1 T GOVERNMENT Gross Saving Rp75,1 T Non Fin. Inv Rp9,0 T Net Lending Rp66,1 T REST OF THE WORLD Net lending Rp18,3 T REST OF THE WORLD Net lending Rp18,3 T Decrease inDeposit Facility Rp23,8 T Increase in SBI of Business & HH Rp2,2 T Increase in SBI owned by Foreign Rp22,5 T Increase in Foreign Reserves $9,5 M (Position: $105,7 M ) Decrease in Curr. of Business & HH Rp15,8 T Increase Central Govt DD (Rupiah: Rp20,0 T; Forex Rp34,2 T) Increase in SBN of Banks Rp13,1 T Increase in SBN of Business & HH Rp15,0 T Increase in SBN of Foregn Rp15,8 T Foreign loan repayment Rp4,9T Increase in Rupiah Loans Rp41,3 T Increase in Forex Loans Rp13,8 T Third Party Fund Withdrawal Rp42,5 T Increase in DD owned by Reg-Govt Rp37,1 T INDONESIAN FOF ANALYSIS, Q1 2011 *) *) Preliminary Figure

19. -19- THE NEEDS OF FURTHER IMPROVEMENT

20. -20- THE ORGANIZATION OF DATA MANAGEMENT

21. Some Efforts in Compiling Indonesian Sectoral Accounts 1.The compilation of Indonesian Sectoral Accounts will be initiated from the related data availability: Flow of Funds and Capital Stocks. 2.BI will have coordination with Statistics Indonesia (BPS) to define sectors of the economy in Indonesia and classification of financial instruments & non-financial assets. 3.BI and BPS jointly formulate an appropriate approach to fill the data gaps between requested Sectoral Accounts and the available data in Indonesia. 4.The availability of technical assistance from international institute (IMF, BIS, WB or OECD) is necessary to speed up the progress of implementation. 5.The implementation of Indonesian Sectoral Accounts will be aligned with country’s timeframe in implementing SNA 2008. MAIN CHALLENGES Among others;  The difficulty in integrating financial and non financial accounts  The problems in adequately covering the activities of household and nonfinancial corporations  Limitation balance sheet and sectoral data at present -21- A WAY FORWARD

22. -22- A Way Forward Possibilities to Compile Sectoral Account – Financial Assets

23. A Way Forward Possibilities to Compile Sectoral Account – Non Financial Assets -23-

24. Indonesia has been experienced in compiling FOF Statistics and has provided FOF data annualy (8 sectors) since 1984, and quarterly (5 sectors) since 1993. The compilation of FOF needs to be further improved to harmonize with current statistic manual (ie. SNA 2008, MFSM and CG-MFS 2008), and to be aligned with other international commitment, such as G20 Data Gaps Initiatives. Regarding the complexity of FOF compilation, the improvement of FOF in Indonesia requires good coordination among authorized institutions, ie. Bank Indonesia, Statistics Indonesia, Ministry of Finance, and Capital Market & Financial Institution Supervisory Agency. In the area of “data coverage”, the efforts would be mostly on collecting data from non-bank financial corporations, non financial corporations, and Households. In the area of “conceptual framework”, Indonesia will initially observe the possibilities to compile FOF based on “true flows” of transaction, valuation, and OCVA. The improvement of FOF statistics will be synchronized with the efforts in the implemention of SNA 2008, especially on constructing full sequence balance sheet. Related to the G-20 Data Gap Initiatives, Indonesia is in considerable progress to provide G-20 data recommendation and will have a study on the compilation of Indonesia sectoral accounts. -24- CONCLUSION & REMARKS

25. Thank you