Indonesia’s Economic Performance Astonishes G20 Advanced Countries, How Come?

Economic Sectors

In recent years, Indonesia’s economic performance has garnered significant attention on the global stage. The latest buzz came from the G20 meeting in Brazil, where several developed nations were taken aback by Indonesia’s ability to sustain its economic recovery while keeping fiscal deficits in check. This begs the question: What is the current economic landscape in Indonesia?

According to Perry Warjiyo, the Governor of Bank Indonesia (BI), Indonesia’s economic growth remains robust, primarily fueled by strong domestic demand, especially in household consumption and investment sectors.

“Investment in construction has surpassed expectations, driven by the ongoing implementation of National Strategic Projects (PSN) across various regions, coupled with positive developments in the private sector resulting from the collaborative efforts of BI and the government,” Perry remarked during a press conference on Thursday (20/3/2024).

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While non-building investments continue to be sustained, there is a need for ongoing stimulation. Despite the high level of global uncertainty, consumer confidence remains solid, and retail sales continue to perform well.

“The consumer confidence index, retail sales index, and Manufacturing PMI are all indicating optimism,” Perry elucidated.

However, Perry also noted that export performance may still be lackluster due to weak demand from key trading partners and declining commodity prices, such as crude palm oil (CPO) and coal.

“Considering these various factors, the projected economic growth for 2024 falls within the range of 4.7% to 5.5%,” Perry emphasized.

In summary, while Indonesia’s economic performance continues to show resilience and strength, challenges remain in certain sectors, particularly in export performance. Nonetheless, with concerted efforts from both the public and private sectors, Indonesia is poised to navigate these challenges and sustain its economic growth trajectory.