President Targets Economy to Increase by 5.9% and Poverty Rate by 7.5% in 2023


Even though it is still in early 2022, the government of President Joko Widodo has already drawn up a work plan for the year 2023. Several things were discussed in the work plan, such as the country’s target, the economy, and the poverty rate.

The government is targeting that Indonesia’s poverty rate, which has increased due to the Covid-19 pandemic, is expected to fall again next year. At least, that percentage can reach the level of 8.5% or even lower to 7.5%.

Quoted from data from the Central Statistics Agency (BPS), Indonesia’s poverty rate in September 2021 was 9.71%. This figure is down 0.43% compared to March 2021.

“For 2023, hopefully, we can reduce the poverty rate to 7.5%-8.5%,” said the Minister of National Development Planning/Head of Bappenas Suharso Monoarfa in the National Coordination Meeting for Development, Thursday (21/4/2022).

Not only poverty, but the government also hopes that the open unemployment rate can drop to the level of 5.3%-6% in 2023. Currently, Indonesia’s open unemployment rate until August 2021 is 6.49%.

Another development target is the Gini ratio, which is expected to drop to 0.375-0.378 next year. And the Human Development Index headed to the level of 73.31-73.49.

The government also plans to reduce greenhouse gas emissions to 27.02%. Of course, what is not left behind is the desire to return Indonesia’s economic growth to the level of 5% next year.

“In 2023, economic growth is planned for 5.3%-5.9%,” he explained.

To encourage the economy to grow above 5%, it is necessary to push the consumption side in the range of 5%, investment at 6%, and exports to the level of 6%-7%.

“Community consumption is expected to grow 5.2%-5.4%, considering that there has been an increase in community activity in the transition from the pandemic to endemic, and hopefully it will return to normal,” he concluded.

Regarding Indonesia’s economic growth during 2022, Bank Danamon economists estimate that Indonesia’s economic growth will reach 5.1% year on year (YoY) in 2022. This is higher than growth in 2021 which was 3.69% YoY.

Although this year’s economic growth is predicted to be higher than the growth in the previous year, Bank Danamon macroeconomic analyst Irman Faiz reminded Indonesia to remain vigilant about the challenges ahead.

“The main challenge is still the escalation of the conflict between Russia and Ukraine. However, what needs to be considered and is more significant is how the development of domestic demand recovery is,” said Faiz, Wednesday (20/4).

In this regard, Faiz appealed to the government to continue to pay attention to the development of Covid-19 cases. Don’t let the development of daily cases of Covid-19 again cause the government to withdraw the emergency brake in the form of strict restrictions.

Following the pattern formed, usually, this limitation of mobility is followed by a decrease in economic activity and then leads to a decrease in consumption activity. This can then become a stumbling block to economic growth.