World Bank expects Indonesian economy to grow 3.7% in 2021

World Bank expects Indonesian economy to grow 3.7% in 2021

World Bank's logo. (ANTARA/HO-World Bank docs/am/KT)

Jakarta (ANTARA) - The World Bank has lowered its forecast for Indonesia's economic growth for this year to 3.7 percent from April's prediction of 4.4 percent citing the recent increase in COVID-19 Delta variant cases.

"The government's capacity to implement intelligent strategies is important. The 3T method can tackle the Delta variant that is very contagious," World Bank's chief economist for East Asia and the Pacific region, Aaditya Mattoo, said during a briefing here on Tuesday.

According to Mattoo, the vaccination program is key to restoring the economy not only in Indonesia but also in other countries in East Asia and the Pacific region.

In the next few months, vaccination coverage will reach 60 percent of the population in many countries, such as Indonesia and the Philippines, which are predicted to reach their target by the first half of 2022, he added.

"Hopefully, Indonesia and the Philippines can reach the target by the middle of next year," he remarked.

Related news: ADB slashes Indonesia's 2021 economic growth forecast to 3.5 percent

Furthermore, Mattoo explained that achieving the vaccination target would signal that community mobility is ready to restart so that the economy can be normalized and recovered.

However, he warned that vaccination alone will not be enough because there are countries that have a high number of vaccinated people, but their economy is still heavily impacted.

Therefore, he suggested that testing, tracing, and isolation (3T) continue to be carried out by the government and asked the public to keep complying with the health protocols.

The World Bank has also predicted a growth of 5.2 percent for the Indonesian economy in 2022, he informed. Meanwhile, by 2023, it can reach 5.1 percent, he added.

"That growth can increase by about 4.5-5 percent in the next few years, supported by macroeconomic policies," he explained.

In addition to vaccination, Mattoo said, economic growth can also be achieved through other endeavors, which are supportive macroeconomic policies, reforms, and new laws.

"The new law is also the reason why we are optimistic," he remarked.

Related news: Indonesia should usher in three reforms for economic restoration: WB
Related news: 2022 economic growth target's lower limit raised to 5.2 percent


 

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