Indonesian Economy Grows 5.72%, Safe from Recession?

Indonesia's economic growth

National economic growth again recorded positive results. In the third quarter of 2022, the Indonesian economy grew 5.72 percent (year-on-year/yoy) or grew by 1.8 percent from the second quarter of 2022. Then, is Indonesia safe from the recession?

Data on Indonesia’s economic growth in the second quarter of 2022 was submitted by the Central Statistics Agency (BPS).

Minister of Finance Sri Mulyani Indrawati said that growth occurred evenly in all provinces with the largest contribution coming from Java Island at 56.30 percent with economic growth of 5.76 percent (YoY).

Indonesia’s goods trade balance in nominal terms also recorded a surplus of in the third quarter of 2022 US$14.92 billion or grew by 12.58 percent (YoY).

“This means that Indonesia’s trade balance has experienced a surplus for 29 consecutive months and Indonesia’s economic recovery is continuing, even strengthening,” Sri Mulyani wrote on her official Instagram @smindrawati, quoted Tuesday (8/11/2022).

This positive achievement was also supported by the recovery of people’s mobility and purchasing power, which was maintained through the state budget as a shock absorber.

The realization of the social protection program (Perlinsos) until the third quarter of 2022 was recorded at 12.46 percent (YoY), while the realization of fuel energy subsidies (BBM) reached 111.96 percent (YoY).

Furthermore, former Vice President of the Republic of Indonesia Jusuf Kalla (JK) previously said that the Indonesian economy was strong enough to face a global recession in 2023.

JK, citing the World Bank’s projections, said that the Indonesian economy has the potential to grow in the range of 5 percent in 2023 along with some other ASEAN countries such as Vietnam in the range of 7.5 percent and the Philippines in the range of 6.5-7 percent.

With this projection, according to him, Indonesia has a better chance during a global recession.

“I believe this world recession will not touch Southeast Asia much, including Indonesia. Indeed we are worried, but we have a chance in this concern, don’t be all pessimistic,” said JK, Wednesday (2/11/2022).

Nevertheless, he still reminded Indonesia to face all problems that arise, including the economic crisis, food crisis, and energy crisis.