Indonesia’s economic growth is solid amid global economic slowdown.Jakarta (ANTARA) - Bank Indonesia (BI) has reported that Indonesia’s economy grew solidly in the fourth quarter of 2023 amid a global economic slowdown.
“Indonesia’s economic growth is solid amid global economic slowdown,” the head of BI's communication department, Erwin Haryono, said in Jakarta on Tuesday.
According to data provided by Statistics Indonesia (BPS), Indonesia’s economy grew by 5.04 percent year-on-year (yoy) in the fourth quarter of 2023, higher than the previous quarter’s 4.94 percent yoy.
With the increase, Indonesia’s overall economic growth in 2023 recorded a solid increase to reach 5.05 percent yoy.
In 2024, the national economy is projected to grow in the range of 4.7–5.5 percent, supported by domestic demand, including the continued growth of consumption, the positive impacts of the election, and an increase in investment in construction, in line with the continued development of National Strategic Projects (PSN), namely the Nusantara capital city (IKN).
Haryono further said that export performance is predicted to not be strong due to the feeble global economy and the decline in commodity prices.
BI is constantly strengthening the government’s fiscal stimulus synergy through macroprudential stimulus to encourage economic growth, especially via domestic demand.
In the fourth quarter of 2023, Indonesia’s economic growth was supported by almost all components of the gross domestic product (GDP).
Household consumption increased by 4.47 percent yoy. Further, there was a rise in mobility during Christmas and New Year, stable buying power, and an increase in consumer confidence.
Consumption of Non-Profit Institutions Serving Households (LNPRT) increased steeply to 18.11 percent (yoy), backed by preparatory activities ahead of the election. The government’s consumption also increased by 2.81 percent (yoy), mainly due to goods and employee expenditure.
Investment swelled 5.02 percent yoy through construction investment, in line with the continued infrastructure construction and the rise in capital investment activities.
Meanwhile, exports grew 1.64 percent yoy on the back of demand from main trade partner countries and maintained positive growth amid a decline in flagship export commodity prices. The recovery of service exports also contributed to the increase in exports as the number of international tourists registered an increase.
The economic growth was also reflected in the business and spatial fields. The business field recorded positive performance and steep growth in the fourth quarter of 2023, especially in main mobility sectors such as transportation and warehousing, provision of accommodation, food, and beverages, as well as wholesale and retail trades.
The processing industry, as the main contributor to economic growth, also saw good growth, in keeping with the strengthening of domestic and global demand.
Meanwhile, spatially, Indonesia’s economic growth in the fourth quarter of 2023 was higher compared to the previous quarter.
The highest economic growth in the quarter was recorded in the regions of Sulawesi, Maluku, and Papua, followed by Kalimantan, Java, Bali-Nusa Tenggara, and Sumatra.
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Translator: Martha Simanjuntak, Yuni Arisandy
Editor: Azis Kurmala
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