Byline: Paul Sutaryono, Jakarta
Ouch! This might have been people's first impression on learning of Standard & Poor's decision to lower its US debt rating from AAA to AA+ in August.
Even the US had to increase its debt ceiling from US$14.3 trillion to $16.7 trillion. But what supernatural power has been protecting Indonesia's national banks against the US debt crisis?
At present, the ratio of US debt to its gross domestic product is 93.20 percent. What is an ideal ratio? In Europe, regulations were set down during the formation of the European Union.
The act, called the Maastricht Treaty, states that each European Union member state should have a state budget deficit that does not exceeding 3 percent of GDP and a debt to GDP ratio of no more than 60 percent.
In fact, many countries have debt to GDP ratios that exceed ideal levels, such as Japan (220.30 percent), Greece (142.80 percent), Italy (119 percent), Belgium (96.80 percent), Ireland (96.20 percent), Portugal (93 percent), Iceland (87.80 percent), Sri Lanka …