The Central Statistics Agency (BPS) noted that Indonesia’s economy was able to grow high in the second quarter of 2023 by 5.17%, exceeding market estimates and expectations. This national achievement is higher than the majority of countries and regions, including Vietnam, the European Union, the United States and South Korea which grew in the same period.
Since the pandemic devastated the economy in 2020, Indonesia’s economic growth has only returned to levels above 5% in the fourth quarter of 2021. Since then, Indonesia’s economic growth has consistently grown above 5%.
The return to normal mobility will also encourage public consumption and correlate with economic recovery. Even though it has slowed compared to the same period last year, the Indonesian economy has consistently grown above 5% until the second quarter of 2023.
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From the expenditure side, the strong national economic growth was supported by public consumption which grew by 5.23% which was driven by the celebration of religious holidays as well as the provision of holiday allowances (THR) and the 13th salary.
Exports of services grew positively and exports of goods also experienced a contraction. This happened in the export of goods, both oil and gas and non-oil and gas. Exports began to experience a contraction of 2.75%, while imports also contracted 3.08%.
Other sectors also showed growth. The manufacturing sector grew by 4.88%, the base metal processing industry grew by 11.49%, the trade sector grew by 5.25%, the food and beverage processing industry grew 4.62%, driven by increased production of refined palm oil and domestic consumption.
Febrio Kacaribu, Head of the Fiscal Policy Office at the Ministry of Finance said, “National investment growth continues to show improvement in line with structural reforms that are being rolled out to create a more attractive investment climate. The positive growth in investment was also driven by growth in building capital goods, equipment and machinery, which meant that production activity continued to be strong.”
By achieving this growth rate and continuing structural improvements, the government is optimistic that the national economic growth rate in 2023 is estimated at around 5.1%. Nonetheless, the government will continue to monitor and anticipate the risks of the current world economic slowdown which will impact Indonesia’s international trade performance.
Source: kemenkeu.go.id, kaltimpost.jawapos.com
