The growth rate is higher than the target set by the government and the House of Representatives at 5.1 percent.
Jakarta (ANTARA News) - Bank Indonesia (BI) Governor Agus Martowardojo said the central bank is more confident the countrys economic growth is around 5.2 percent in 2017.

The growth rate is higher than the target set by the government and the House of Representatives at 5.1 percent.

Agus said the rate set by the government, however, is still in the range of 5.1 percent-5.5 percent, the target set by the central bank for the countrys economic growth rate in 2017.

Meanwhile, the central bank cut its 7-day Repo Rate to 5 percent from 5.2 percent in a bid to boost credit growth.

Deputy Governor of Bank Indonesia Perry Warjiyo said the central bank policy including in cutting interest rate, relaxation of macro prudential including minimum reserve requirement would boost bank credit and credit demand.

Perry said the factor slowing credit expansion include high non-performing ratio of 3.2 percent gross or 1.5 percent net in July 2016. However, there was relaxation in liquidity and loan to value ratio.

Other factors include economic growth and interest rate, he said, adding strong economic growth and low interest would boost demand for credits .

In July, bank credit grew 7.7 percent year-on-year lower than 8.9 percent in June . Third party funds held by bank grew 5.9 percent in July relatively stable and the same as in the previous months .

Separately,Finance Minister Sri Mulyani Indrawati said the government would seek to meet the economic growth target of around 5 percent this year amid the global economic slowdown.

The minister said the country fared better than many other countries with the economy could grow 5 percent a year, but "we need to be careful in facing the global economic challenge.

The government, therefore, would seek to keep low inflation at around 4 percent, she said.

She said the government could hope for a better economic performance in investment by the private sector with the inflows of repatriated fund under the tax amnesty program.

The government has issued tax amnesty program hoping for the repatriation of huge funds parked abroad by rich Indonesians.

Sri Mulyani said the government also hopes for recovery in export and import performance after being in the doldrums in the past two years.

"We see exports and imports have contracted in the past two years but now both exports and imports are getting closer to positive territory," she said. (*)

Editor: Heru Purwanto
Copyright © ANTARA 2016