Tuesday, 19 November 2019

Economic Growth Target Likely Unmet, Gov't Predicts

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Laila Afifa

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  • TEMPO.CO, Jakarta - The government predicts that this year's economic growth would only reach 5.2 percent. The projection is lower than the initial target of 5.4 percent set in the 2019 State Budget.

    The estimation is derived from the growth in semester one, which is projected at 5.1 percent. Semester's two growth rate is predicted at 5.2 percent.

    Finance Minister Sri Mulyani said that the projection is temporary. The central statistics Agency, BPS, will release the official date next month.

    Speaking at a work meeting with the House of Representatives' Budgetary Board, Sri Mulyani said Indonesia's economy will still rely on household consumption. Sri is confident that growth in the second half will be higher than in the first, supported by accelerated government spending and private expansion.

    The minister predicts that domestic demand will remain high as inflation is quite low at 3.3 percent in semester one. For the second half, the inflation rate is estimated to go down to 3.1 percent.

    She added that the global economic slowdown is also affecting Indonesia's foreign trade, which calls for productivity improvement on the domestic side as it is "closely related to labor, infrastructure and bureaucracy.

    Caesar Akbar | Larissa Huda