Indonesia is finalizing a second stimulus package aimed at easing export and import regulations to counter supply chain disruptions because of the spread of Covid-19.

Coordinating Economic Minister Airlangga Hartarto said eight measures will be incorporated into the package which follows the first 10.3 trillion rupiah (RM3 billion) stimulus unveiled last week.

According to The Jakarta Post, Airlangga said the next stimulus will be bigger, after the first one which was introduced to support consumer spending and tourism.

“Trade easing will be expanded to keep the momentum of boosting exports. We are also working to relax the income tax and import duty to boost production,” he said of the next package the government is working on.

Airlangga said the second stimulus package would be worth more than Rp 10 trillion, adding that the government would announce the new stimulus package soon to help support trade.

“Several export-import licenses will be removed given the current circumstances.”

In support of the second stimulus package, Finance Minister Sri Mulyani Indrawati had said that the government would need to ease import requirements of raw materials for local manufacturers.

This was because the disruption of the supply chain from China due to Covid-19 had begun to affect the country’s manufacturing sector, he explained.

The secretary to the coordinating economic minister, Susiwijono Moegiarso, had also earlier said that the new stimulus package would ease procedures to import raw materials from countries outside China and procedures to export wood-related products.

President Joko Widodo, too, has called on government officials to respond to the global dynamics, asking officials to relax import procedures.

“Supply from China has been disrupted and thus we need to relax [procedures]. If not, prices will skyrocket and this will drive inflation,” Jokowi said.

“It is all the same for exports as we need to supply other countries. Procedures must be relaxed and simplified. But first we need to pay attention to sufficiency of raw materials.”

Bank Indonesia (BI) projected weakening economic activities in tourism, exports and imports to drag down the country’s economic growth to 4.9 per cent in the first quarter before picking up in subsequent quarters.

BI Governor Perry Warjiyo said Covid-19 had hurt businesses engaged in trade as well as tourism-related industries in February, which would likely continue but bottom out in March.

“Recovery is likely to take place in the next six months after bottoming out in February and March,” Perry said in a briefing to the media here recently.