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[News] Moderate Growth For Indonesia’s Economy
Posted at: 25 October 2019

Indonesia's economic growth was estimated to remain at moderate level around 5 percent until 2021, mostly backed by consumption, a World Bank (WB) senior economist said on Thursday.

Speaking in a teleconference to publish WB's latest report entitled "Weathering Global Risk" here, WB Senior Economist for East Asia and the Pacific region Andrew Mason estimated that Indonesia would see a 5.2 percent growth this year, followed by 5.1 percent next year and bouncing back to 5.2 percent in 2021.

"Those growths would be significantly supported by the continuously-strong consumption sector due to well-controlled inflation, coupled by expanding jobs opening," he said.

Indonesia's investments were estimated to grow 5 percent this year, expanding more to 5.5 percent and 6 percent in 2020 and 2021 respectively, thanks to the improved fiscal and the progressing of massive infrastructure projects across the nation, he added.

Those estimated investment growth figures, however, were lower than 6.7 percent recorded last year by WB.

"Even it slows down, sentiment for growth in Indonesia's investment sector would be stronger after the successful elections, coupled with growing business trend to respond government's attractive policies to attract foreign investments," he added.

In term of exports, Mason estimated that Indonesia may see weakening exports that grow minus 1 percent this year. He, however, said that recovery in exports growth could be seen in next year by 1.5 percent, growing further by 2.8 percent in 2021.

On imports, the WB senior economist estimated that imports would also be weaken this year and to expand in the following years by 2 percent and 3.7 percent in 2020 and 2021 respectively.

He also estimated that Indonesia would see decreasing Current Account Deficit (CAD) to 2.8 percent from the nation's Gross Domestic Products (GDP) this year after saw an unprecedented level months ago.

Indonesia recorded CAD of 3.04 percent from GDP in the second quarter this year, far higher than 2.6 percent in the first quarter, or 3.01 percent in the second quarter last year.

It was due to increasing foreign debt payment, coupled by the ensuing global economy downturn and decreasing commodity prices, according to Indonesian central bank.

(source: Xinhua News)