Indonesia’s growth outlook remains positive due to domestic demand, expansion of government spending and fixed investments.
However, US-China trade tensions continue to pose downside risks in terms of the volatility of the Rupiah as well as rising crude oil prices, putting more pressure on Indonesia’s current account deficit. Danareksa, a state-owned financial institution in Indonesia, expects the country’s economy to slow down by 2019 but will strongly accelerate growth to the range of 5.3 to 5.4 percent in 2020.
Indonesia’s current GDP annual growth is at 5.17 percent in the third quarter of 2018. It remains the largest economy in ASEAN.
Three years ago, the Asian Infrastructure Investment Bank (AIIB) began investing in Indonesia in hopes to improve the country's social and economic welfare. Throughout the years, those investments have proven to be beneficial, not only to its economy but also to its people by bringing about massive changes in their lives.
Indonesia remains the second-largest borrower of the AIIB among its 66 members. In the past three years, the bank has invested a total of 691 million U.S. dollars in five infrastructure projects, some of which include modernizing the country's irrigation system.
This will help to advance Indonesia's agriculture, one of the backbones of the country's economy. Other projects include helping millions of people out of slum areas and developing tourism infrastructure in Lombok Island, helping to achieve the Indonesian government's goal of creating more tourist islands aside from the popular island of Bali.
(source: ASEAN Briefing and The Jakarta Post)