Indonesia’s economy may expand more than 5 percent in the first three months this year as exports and investment accelerate, the Central Statistics Agency (BPS) said Monday.
Its forecast is based on the calculation that an increase in growth components will have a significant effect as compared to the low growth components booked in the first quarter of 2009, BPS head Rusman Heriawan said before a Cabinet meeting at the State Palace.
Southeast Asia’s largest economy in the first three months of 2009 grew by a modest 4.4 percent from the same period a year earlier, with exports contracting by 19.1 percent amid the global financial crisis, according to the BPS.
“So with little increase in exports, the [growth] percentage will be high enough,” Rusman said.
“Those who drive the economic growth in the first quarter of 2010 may help it reach more than
5 percent.”
He said all growth components would show improvement. “Exports will improve along with investment,” he said, adding that household consumption and government spending would remain strong.
Exports of non-oil-and-gas products in January rose 47.6 percent from a year earlier, according to the BPS.
The figure increased from the 44.55 percent booked in December.
The central bank has raised its growth forecast of Indonesia’s economy because of the strong indicator. Bank Indonesia estimates the economy will expand 5.7 percent in the first three months this year, up from the initial projection of 4.8 percent.
BI estimates the full-year growth to range between 5.5 and 6 percent and further accelerate to between 6 and 6.5 percent in 2011.
Last year the economy grew by 4.5 percent, the BPS said.
It also said Indonesia managed to cope fairly well concerning the global crisis because of less dependency on exports.
Analysts have said Indonesia’s economy may expand close to 6 percent this year on the back of stronger exports and investment.
The Jakarta Composite Index has continued to increase, closing at 2,669.61 on Monday, a 5.3 percent increase from 2,534.36 at last year’s closing.
The index was closed at 1,340.89 in 2008.
The rupiah was traded at Rp 9,168 per US dollar at 3:40 p.m. in Jakarta, Bloomberg reported.
The yield on the 11 percent bond maturing November 2020 fell 5 basis points to 9.37 percent.
The rupiah will trade between Rp 9,080 and Rp 9,200 this week, said Vishnu Varathan, a regional economist at Forecast Singapore Pte Ltd, as quoted by Bloomberg.
Last week Standard & Poor’s upgraded Indonesia’s ratings to two levels below investment grade.
Fitch Ratings in January upgraded the ratings to one level below investment grade while Moody’s Investors Service in September 2009 upgraded it to two levels below investment grade.
