ICAEW Predicts Southeast Asia's GDP at 6.2% in 2021

TEMPO.CO, Jakarta - Oxford Economics and the Institute of Chartered Accountants in England and Wales (ICAEW) published their latest report on Southeast Asia's economy. The report predict the entire region's GDP will be contracted in 2020 before surging in 2021.

They project a 4.1 percent contraction to the GDP, before rebounding and rising by 6.2 percent next year.

In the report that Tempo received in Jakarta, Monday, December 28, the recovery will stem from this year's low base effect. However, macro policies are expected to remain accommodative with "extensive fiscal support and low interest rates."

However, for Indonesia in particular, the ICAEW and Oxford Economics aren’t quite sure just yet due to the nation's weak mobility trends, a two-digit import decline, and weakening retail sales.

Nevertheless, retail sales volume and industrial production in Indonesia are relatively stable compared to neighbor states, which are hit quite hard.  

Overall, the pandemic is expected to leave a deep, permanent scar to Indonesia's GDP, which the report predicts to shrink by 2.2 percent this year, before surging to 6 percent in 2021, "with the help of consumer and infrastructure spending."

Also Read: Bank Indonesia Claims Foreign Debt Ratio Still 'Healthy'

FAJAR PEBRIANTO