As trade disputes threaten to upset the balance of the world economy, Indonesia held the annual meeting between the International Monetary Fund and the World Bank.

On Sunday, the annual meeting of the International Monetary Fund (IMF) and World Bank (WB) wrapped up in Bali, Indonesia amid praise and criticism from activists and lawmakers over the country’s efforts to recover from a magnitude 7.5 quake and tsunami just weeks ago. The natural disasters devastated three cities in the Central Sulawesi province (Palu, Donggala, and Sigi) and killed more than 2,000 people.

The annual meeting was highly anticipated and watched as the event was held at a time when the global economy is facing a shakeup due to the trade war between the U.S. and China.

Peter Jacobs, chair of the Work Unit of the International Monetary Fund (IMF) Annual Meeting of the World Bank (UKPTI), said that the agreements produced in the gathering would be used as a reference by world leaders to decide future economic and national policies.

“The world’s economy is currently in uncertainty. The world is waiting for agreements reached in the meeting as they will be used as a reference for policy-making process,” said Jacobs in Nusa Dua on the opening of the meeting on October, 8.

Over 36,000 participants attended the meeting, exceeding the initial expectation of around 19,800. Indonesia’s Coordinating Minister for Maritime Luhut Binsar Panjaitan said that the number of attendees this year was beyond his expectation.

“The total participants are around 32,000 people, and it’s more than our prediction. The number will likely increase because today is the last [registration day],” said the minister in a written statement received by Tempo, Friday, October 5.

The meeting also acted as a show of solidarity and support for the host nation, which was hit by two consecutive quakes in Lombok, West Nusa Tenggara, and Central Sulawesi. In the latter, a 7.5-magnitude tremor was followed by the tsunami that killed more than 2,000 people.

The IMF donated around Rp 2 billion to quake and quake-tsunami victims in Lombok and Central Sulawesi’s Palu, Donggala, and Sigi. The aid will be distributed by humanitarian organizations such as World Vision, the Indonesian Red Cross (PMI) and others.

Highlights From the IMF-World Bank Meeting

Trade War and Debt Pose the Highest Risk to the Global Economy

The worsening trade spat and increasing debt risks were among the main topics discussed in the Development Committee (DC) of the IMF and World Bank.

The DC is a ministerial forum of the IMF-WB aimed at discussing and reaching inter-governmental agreements on several world development main issues.

“Our meetings had a strong focus on building human capital, particularly given the implications of technological advances on jobs, the financial sector, and other aspects of development. New jobs are being created that did not exist a decade ago, while some skills that were formerly relevant are becoming obsolete. We discussed the need to ensure that all individuals have access to the skills and capabilities to adapt and prosper in the face of digital disruption. Given the strains on public finance systems, new approaches will be required,” said the Development Committee (DC) Communique.

China’s central bank governor, Yi Gang, also said in a statement that trade war and protectionism pose ‘major risk for the world economy.’

Ultimately, the meeting did little to nothing to solve the trade spat between the U.S. and China, as both countries have yet to find a common ground.

The DC will hold an upcoming meeting in Washington on April 13, 2019.

‘Games of Thrones’ Quoted in Joko Widodo’s Speech

In the opening speech, Indonesian President Joko Widodo likened the current global economy to the popular TV series Games of Thrones where families and kingdoms fight for power and influence.

“I want to assure that we are entering the final session of global economic expansion that is full of rivalry and competition, and that can turn into something which is more critical than the global financial crisis 10 years ago,” Joko said.

The president also used sayings commonly associated with the TV series such as “winter is coming” to describe the increase in global uncertainty and “evil winter” to describe rising global threats such as climate change and plastic waste.

The moral of the speech, Joko stated, was that conflict and confrontation benefit no one, even if one country is considered the “winner”. When world powerhouses are in conflict they fail to address other bigger threats such as global terrorism, climate change, and global economic meltdowns.

The speech earned a standing ovation from the world’s highest-ranked officials. Denmark Ambassador to Indonesia Rasmus A. Kristensen, for example, hailed Joko’s speech in his Twitter account saying cooperation and unity are needed to solve global problems.

The speech also drew some criticism. A lawmaker from Indonesia’s opposition Gerindra Party, Fadli Zon, slammed the speech for portraying Indonesia as dependent on global lenders.

Joko’s statement, “We depend on you all, the monetary and fiscal policymakers to keep the commitment of global cooperation,” was criticized as a portrayal of a weak Indonesian economy.

The Bali Fintech Agenda 

One highlight of the meeting was an event called the Bali Fintech Agenda which offered guidelines for the consideration of issues in the global financial technology (fintech) sector. Fintech is considered a new industry that uses emerging technology to improve access to financial services – an example is using mobile phones to access your bank account.

According to the IMF Managing Director Christine Lagarde, there are 1.7 billion adults worldwide who do not have access to financial services and fintech can make a significant social and economic impact on them. While the World Bank President Jim Yong Kim added that the agenda could produce a framework to guarantee sustainable development, especially in low-income countries where the access to financial service is still limited.

Deputy Chairman of the Fintech Association (Aftech) Adrian Gunadi explained that they had created a 12-point agenda for use as a reference for fintech sectors worldwide, but implementation must be adjusted to each country’s infrastructure readiness.

Indonesia’s Finance Minister Sri Mulyani Wins Best Finance Minister in the East Asia and Pacific region

In between events at the WB-IMF meeting, Sri Mulyani was awarded the best finance minister in the region from Global Markets magazine. The Bandar Lampung-born woman was hailed for her work to maintain Indonesia’s economic performance amid global uncertainties.

According to Global Markets, the former World Bank Managing Director overcame two problems: tax collection and the state budget’s absorption.

Tax collection in 2017 hit 91 percent of Indonesia’s targeted revenue, up from 83 percent in 2015, thanks to a tax amnesty program that brought Indonesian wealth back home.

Government spending has grown fast since 2017, accounting for 21.1 percent of the country’s GDP. The state budget absorption rose to the highest level in six years, according to the ministry of finance’s statement.

But nothing is perfect – a CNBC research team revealed that despite the increase in tax revenue, the tax-to-GDP ratio is still low. According to financial data in 2017, the tax ratio was recorded at less than 11 percent – below the IMF’s threshold of 15 percent for stimulating economic growth.

Tax ratio is a formula to measure taxation performance by comparing tax revenue and a country’s GDP in a certain period of time. The lower tax ratio is, the lower domestic tax compliance is and the lower tax revenue is.

Will Indonesia Benefit from Hosting the Meeting?

The Indonesian government said that they would offer countries attending the meeting investments worth Rp 252 trillion in 19 Indonesian infrastructure projects. Infrastructure financing was one of Indonesia’s main focuses at the annual meeting; however, there is no guarantee that infrastructure projects will be completed smoothly.

Not everyone is pleased with Indonesia’s efforts to improve infrastructure. The development of the Kulonprogo Airport in Yogyakarta, for example, has been criticized for damaging the environment and causing pollution that will harm farmland.

Indonesia will also have a chance to show off the country’s development on a world stage.

“Indonesia as the host will have a sort of opportunity to have its voice heard and demonstrate its progress as a country and what it can offer to the world,” World Bank press secretary, David Theis, said.

After expenses, the country was also expected to make Rp 500 billion ($35 million) in profit from the event.