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Weaker consumption, exports bite Indonesia's 2023 economic growth
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Road to progress: Motorcyclists compete for space on Aug. 24, 2023, in bumper-to-bumper congestion on Jl. Gatot Subroto in South Jakarta. Data from the Environment and Forestry Ministry show that the transportation sector contributed 96.36 percent to Jakarta’s carbon dioxide output. (Antara/Aditya Pradana Putra)
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ndonesia’s economy expanded at a much slower rate last year, with weaker household spending and exports weighing on the country’s economic output.
The country’s GDP grew by 5.05 percent last year, much lower than the 5.31 percent logged the previous year, Statistics Indonesia (BPS) data show.
This figure also fell short of the 5.3 percent target stipulated in the government’s budget for last year, but it fell exactly in line with the Finance Ministry’s projection for 2023 made in early January.
Interim BPS head Amalia Adininggar Widyasanti attributed the slowdown to slower growth in spending, particularly among upper-middle earners, as hinted by the much lower collection of luxury goods tax, a decline in air travel and a drop in car sales last year.
“Meanwhile, financial investments like futures strengthened, indicating a slight shift from spending to investment,” said Amalia
Read also: Weaker global economy, commodity demand cut into 2023 exports
Growth in household spending, which contributed over half of the national GDP, dipped to 4.82 percent last year from 4.93 percent the year before.
