"The potential for continued positive economic growth in the first quarter of 2022 is still open; when compared to growth in the fourth quarter of 2021, it is estimated that it will be lower," Manilet projected in Jakarta on Wednesday.
Earlier, Finance Minister Sri Mulyani Indrawati had said that the national economy is expected to grow 5 percent year on year (yoy) in the fourth quarter of 2021.
According to him, economic activity in the fourth quarter of 2021 began to swell after the government loosened the implementation of community activity restrictions (PPKM). The momentum of Christmas and New Year, as well as national spending day, also contributed to this, he added.
Meanwhile, in the first quarter of 2022, the factors driving economic growth are seen to be relatively few, he said.
However, public consumption will still support growth in the first quarter because, based on the Consumer Confidence Index in November 2021, consumers are increasingly optimistic about economic growth in the next six months, he noted.
"On the other hand, various government assistance that began to be redistributed at the beginning of the year, such as social assistance, will be a driving force for purchasing power, especially for the lower middle class," he explained.
As the economy shows signs of recovery this year, inflation will also become higher, he said.
In addition, several policies implemented by the government such as the increase in Value Added Tax (VAT) rates, gas price increase, and excise tariffs will also have an impact on inflation, he added.
To control inflation, the government needs to maintain the flow of production and distribution of commodities that have the potential to contribute to high inflation, such as rice, chilies, onions, and other basic and important commodities, Manilet said.
"On the other hand, because inflation has the potential to suppress people's purchasing power, the social safety net is an essential part for the government to pay attention to; assistance such as social assistance and subsidies must be distributed quickly and accurately," he added.
The Indonesian Economics Scholars Association (ISEI) had earlier expressed optimism that Indonesia's economy would improve in 2022, supported by increased private consumption and export performance as well as maintained government fiscal spending, he noted.
"This webinar activity is expected to build optimism for a better 2022, in particular, to continue to encourage the economy of Jakarta as the epicenter of the national economy," he affirmed.
During a webinar on Friday, head of the Economic Bureau of the Jakarta Regional Secretariat, Mochammad Abbas, said that the economy of DKI Jakarta in 2022 is projected to be better than the previous period.
He highlighted several strategies for ensuring fulfillment of food requirements, developing MSMEs (micro, small, and medium enterprises) and the creative economy, moving the real sector, creating jobs while reducing the unemployment rate, and maintaining the investment climate to encourage economic recovery in Jakarta.
"I am optimistic that economic recovery in 2022 would improve, both at the national level and in Jakarta," ISEI chairman Perry Warjiyo noted at an ISEI webinar on Friday.
Perry, who is also the governor of Bank Indonesia, advised ISEI to continue to strengthen its role in building strong synergy between various parties, including academics, businesspersons, and the government for encouraging new sources of economic growth, promoting digitalization, as well as an inclusive and green financial economy.
In addition, ISEI must continue to lay the foundation for realizing an advanced Indonesia, in terms of the adoption of digital, inclusive, and green technology.
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Translator: Sanya D, Azis Kurmala
Editor: Sri Haryati
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