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Govt ‘could’ push spending to boost slowing GDP growth
The government says it could push state spending to boost gross domestic product (GDP) growth in the second half of the year as data published on Monday points to a slight deceleration of the economy.
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Coordinating Economic Minister Airlangga Hartarto (left) and his interpreter (right) stand before the press in his Jakarta office on Aug. 5, 2024, to comment on Indonesia's latest GDP growth report. (JP/Deni Ghifari)
T
he government says it could push state spending to boost gross domestic product (GDP) growth in the second half of the year as new data points to a slight deceleration of the economy.
Statistics Indonesia (BPS) official Edy Mahmud revealed in a press conference on Monday that economic growth in the second quarter slowed to 5.05 percent year-on-year (yoy) from 5.11 percent in the first quarter.
The latest growth figure is also down from the 5.17 percent logged the second quarter of last year.
In a separate media briefing, Coordinating Economic Minister Airlangga said on Monday that the figure showed “that our economic fundamentals are still good”, supported by “inflation that remains under control”.
He added that “pushing state expenditure” in the remainder of the year was one of the measures the government could take to boost growth.
Government spending rose just 1.42 percent yoy in the second quarter, making it a drag on overall economic growth, the latest GDP report shows.
“In the second quarter, we held back [government spending] a little bit, because we were trying to move the sectors outside the government, because government spending only contributes 7 percent to our total GDP. That’s why we push for activities [outside the government],” Airlangga said.
