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Ahead of election, Indonesia’s GDP will improve: Schroders

Winny Tang (The Jakarta Post)
Jakarta
Sun, October 15, 2017

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Ahead of election, Indonesia’s GDP will improve: Schroders Schroders projects stable economic growth ahead of the presidential election (Schroders/Schroders)

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head of the 2019 presidential election, Indonesia’s economic growth will be better than this year as long as the commodity prices stays stable, the nation’s biggest mutual fund manager, PT Schroders Investment Management Indonesia, projects.

Schroders head of intermediary business Teddy Oetomo expects the GDP growth to expand by between 5.1 to 5.5 percent in 2018, similar to Bank Indonesia’s projection.

“With conservative assumption of commodity prices, we believe that next year’s economic growth can be sustained by the growth in government and private consumption,” he said recently.

Next year, there will be regional elections in three provinces, Central Java, East Java and West Java, which all account for 40 percent of the country’s total population. Therefore, the money in circulation will be huge, and the private consumption will rise, he said.

In 2018, however, the pressure for Indonesia’s economy will most likely come from global risks, such as the rise in US Federal Reserve interest rates and the forthcoming change of the US central bank’s officials.

“There’s not much to worry about in our country. Our debt ratio is one of the lowest compared to other countries, and Indonesia posted trade surplus, and the banking liquidity is still in check,” he explained.

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