"There is a possibility that Indonesia will be reclassified as an upper-middle-income country by June," stated Dewi Virgiyanti, Bappenas' acting deputy for regional development, on Thursday.
"Indonesia previously held this classification, but the COVID-19 pandemic caused a decline to lower-middle-income status."
The World Bank has set the gross national income (GNI) threshold for upper-middle-income economies at US$4,466. Indonesia's GNI was recorded at US$4,580 in 2022.
Virgiyanti explained that a lower middle-income country would find it difficult to rise to the developed category because of the middle-income trap. This situation occurs when a nation experiences economic growth but struggles to reach the next level of development.
To accelerate progress towards developed nation status, she emphasized the importance of swiftly identifying new sources of economic growth.
She said that the country needs to tap into its growth sources since, to become a developed country by 2045, it will need to ensure annual economic growth of 6.0 to 7.0 percent.
"We have to grow 6.0 to 7.0 percent every year; it can no longer be ordinary, like currently around 5.1–5.4 percent. This has to grow faster to be more exponential going forward," she added.
"We want to carry out many transformations, especially through the 2025–2045 National Long-Term Development Plan (RPJPN) in our next 20 years of development, namely towards Golden Indonesia 2045," she added.
Related news: OECD accession to help Indonesia escape middle-income trap: minister
Related news: Productivity key to avoid middle-income trap: Finance Minister
Translator: M Alatas, Kenzu
Editor: Anton Santoso
Copyright © ANTARA 2024
