Raja Ampat, Papua (ANTARA) - Director of the Economic and Monetary Policy Department of Bank of Indonesia (BI), Erwindo Kolopaking, stated that Gen X and Gen Z support domestic economic growth with their consumption in the household sector.

"The household sector is still the backbone of our domestic economy. It includes restaurant, food, beverages, and other dining activities. Our Gen X and Gen Z supported those businesses. Those are the source of our current economic growth," Kolopaking stated in Raja Ampat, Papua, on Saturday.

Apart from contributing to household consumption, he noted that Gen X and Gen Z also played a role in supporting the non-bank financing sector with its easy access, such as PayLater.

In future, Kolopaking affirmed that those income structures should continue to support popular businesses among members of Gen X and Gen Z to bring significant impact for household consumption.

Luckily, Indonesia has a fairly high productive age composition, with a large population, which is something that is not found in developed countries, he remarked.

"We have a fairly high productive age (composition). Meanwhile, in developed countries, the productive age population is very low," he pointed out.

According to Kolopaking, the government has targeted Indonesia's economic growth to reach 5.3 percent, with the inflation rate at 3.6 percent, and currency exchange rate of Rp14,800 per US dollar.

From the investment side, he noted that investment in the construction sector, especially in the new capital city (IKN) Nusantara, is quite promising. This trend also occurs in the private sector where interest in property increased in terms of investment and other property indicators.

Meanwhile, on the business side, conditions are said to be improving, especially in the mining industry, especially nickel.

However, business activity in the agricultural sector tends to slow down due to the El Nino phenomenon, Kolopaking remarked.

Regarding the oil and gas and non-oil and gas trade balance, he noted that the condition was still quite good.

"For non-oil and gas sectors, the condition is improving. Meanwhile, the oil and gas sector is decreasing due to a decline in coal. This was caused by a geopolitical situation," he explained.

Kolopaking then emphasized that core inflation was maintained, with a relatively low figure of 1.91 percent.

"This is because in the future, the Consumer Price Index (CPI) target will decrease from three percent, give or take one percent, to 2.5 percent, give or take one percent. Therefore, we must maintain the inflation, especially our expectation towards it," he revealed.

Related news: Govt readies strategies to maintain economic growth
Related news: Indonesia's current trade conditions strong: deputy minister
Related news: Southern West Java can be new economic growth driver: BI

Translator: Sella Panduarsa, Resinta Sulistiyandari
Editor: Azis Kurmala
Copyright © ANTARA 2023