President Joko Widodo, known as Jokowi, has highlighted the economic situations of various countries worldwide, noting that nations like Japan and the United Kingdom have fallen into recession, while others teeter on the brink. However, Indonesia stands out with a mere 1.5% probability of facing a crisis. Jokowi emphasized the importance of gratitude and vigilance in maintaining Indonesia’s economic stability.
During a Leadership Meeting of the Indonesian National Armed Forces (TNI)/Police, Jokowi shared insights on global economic trends, stating, “Britain and Japan have already entered recession, and the probability of recession hitting major countries is high. Germany (probability) 72%, likely to enter recession. The European Union 60%, the United States (US) 40%.”
Despite global economic challenges, Indonesia’s resilience shines through with only a 1.5% probability of facing a crisis. Jokowi urged continued vigilance, emphasizing, “We should be grateful that Indonesia is still at 1.5%. This must continue to be maintained.”
In recent economic reports, Japan’s GDP contracted by 0.4% in the fourth quarter of 2023, with a substantial 3.3% contraction in the third quarter of the same year. These figures deviated significantly from economists’ forecasts, indicating greater economic volatility.
Similarly, the United Kingdom experienced a recession with consecutive quarterly contractions of -0.1% and -0.3% in the third and fourth quarters of 2023, respectively.
Looking ahead, Germany faces projections of entering a recession in the first quarter of 2024. Weak external industrial demand and cautious domestic consumer spending due to high interest rates contribute to this economic outlook.
Germany’s GDP contracted by 0.3% annually in the fourth quarter of 2023, signaling potential challenges ahead. If the trend continues in the first quarter of 2024, Germany could officially enter a technical recession.
In response to these global economic shifts, Satu Kahkonen, the World Bank’s Country Director for Indonesia and Timor-Leste, offered insights into Indonesia’s economic trajectory. Despite projecting a slight slowdown in 2024, with economic growth forecasted at 4.9%, Kahkonen emphasized the relative resilience of Indonesia’s economy amid global uncertainties.
“We project a very, very small slowdown from 5% to 4.9%,” Kahkonen stated, underlining the World Bank’s cautious optimism. However, he noted that these projections remain subject to change, with potential for Indonesia’s economy to outperform expectations in the coming year.
