Fundamentals of Indonesia's economy still good amid outbreak: CORE

Fundamentals of Indonesia's economy still good amid outbreak: CORE

Documentation - Economic observer from the Indonesian Center of Reform on Economics (Core) Piter Abdullah Redjalam. Antara / Dewa Wiguna / aa.

Jakarta (ANTARA) - The fundamentals of Indonesia’s economy are still relatively good overall amid the COVID-19 pandemic, according an assessment by Director of research at the Indonesian Center of Reform on Economic (CORE) Piter Abdullah.

"Overall, our economic problems, quote-unquote, are fine. Our fundamentals are still relatively good," he noted during an online discussion in Jakarta on Wednesday.

Abdullah opined that Indonesia's economy that grew only by 2.97 percent in the first quarter of 2020 was explicable owing to the impact of the COVID-19 pandemic.

Economic contraction due to the COVID-19 pandemic occurred not only in Indonesia but also in nearly all nations that registered an even greater decline, according to Abdullah.

"If our economic growth slows down, that is very reasonable. I always say that economic contraction should not be used as an indicator but rather how we deal with the COVID-19 outbreak," he stated.

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Abdullah believes that the World Bank’s forecast of Indonesia’s gross domestic product to grow at zero percent is better than the CORE projection of around zero percent to contract to minus two percent.

"In my opinion, the figure is better than I expected. I estimate in CORE the range of zero percent to minus two percent, but again, our point is not at the level," he stated.

Abdullah noted that economic contraction is inevitable as long as the COVID-19 outbreak lingers on. Hence, he highlighted the need for the government to prepare policies and strategies for the recovery period.

"It would be better if we had minus two percent this year, but we could grow six to seven percent in 2021 then we could hold it at zero percent but would only grow one to two percent in 2021," he added.

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