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Slow economic growth predicted in 2017: Economists
Economists predicted that Indonesia would be struggling to maintain economic growth next year, partly due to heavy pressure on domestic consumption.
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Indonesia's gross domestic product growth. (Source: Central Statistics Agency (BPS)/File)
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conomists predicted that Indonesia would be struggling to maintain economic growth next year, partly due to heavy pressure on domestic consumption.
The University of Indonesia economist Faisal Basri forecasts that Indonesia’s gross domestic product (GDP) would grow by 5 percent year-on-year in 2017, a slight increase from the predicted 4.9 percent growth this year.
“Domestic consumption is under heavy pressure, especially for low-income people,” he said Monday during a seminar discussing the outlook of Indonesia’s economy in Jakarta.
Faisal said that household consumption, which constitutes 56 percent of the GDP, had been under pressure in recent years. This has been proven through the decline in the farmer exchange value (NTP) index – which measures farmers' purchasing power – to 101.31 in November from 102.95 in the same month last year, according to data from the Central Statistics Agency.
To achieve higher GDP growth, Indonesia should focus on attracting more investment into the country, Sampoerna University economist Wahyu Soedarmono said.
“If the government wants to achieve GDP growth of 7 percent in 2019, then the country should increase productivity,” he said, adding that high productivity would bolster investment and spur economic growth.
Amid a weak global economy, Indonesia saw its GDP increase only 4.79 percent last year, the lowest rate in six years. (win/hwa)
