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Economic growth slows as Indonesia loses momentum
The growth of Indonesia’s gross domestic product (GDP) slowed to 5.05 percent in the second quarter of this year, down from 5.07 percent in the previous year.
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Merchants and buyers pack the Tanah Abang Skybridge that connects the railway station to the famous Tanah Abang textile market in Central Jakarta . Indonesian economic growth slowed in the second quarter despite the increase in household spending ahead of Idul Fitri in June this year.
(The Jakarta Post/Dhoni Setiawan)
I
ndonesia recorded lower economic growth in the second quarter of this year as it lost the momentum that had come from an increase in consumer spending, payroll bonuses and migrant worker remittances during Idul Fitri, according to the Institute for Development of Economics and Finance (Indef).
“Indonesia missed the momentum to boost its economy when there were payroll bonuses and remittances from overseas workers during Idul Fitri and spending for general elections in April, an increase in consumer spending in the second quarter,” Indef executive director Tauhid Ahmad said in Jakarta on Aug. 7.
For April’s presidential and legislative elections, the government spent more than Rp 25 trillion (US$1.7 billion), while candidates Joko “Jokowi” Widodo and Ma’ruf Amin reported total spending of Rp 601 billion for campaign activities and their rivals Prabowo Subianto and Sandiaga Uno Rp 211.5 billion.
The growth of Indonesia’s gross domestic product (GDP) slowed to 5.05 percent in the second quarter of this year, down from 5.07 percent in the previous year, despite high spending during the Idul Fitri holidays and on the general elections, Statistics Indonesia (BPS) reported on Aug. 5.
The second quarter’s growth rate was far lower than the 5.27 percent in the same period of last year, when there were Idul Fitri holidays and simultaneous elections of heads of local administrations.
Tauhid added that the second quarter’s GDP growth should have reached 5.24 percent or 5.27 percent. For comparison, the GDP growth rate increased to 5.27 percent in the same period of last year from 5.06 percent in the previous quarter.
According to BPS, household spending, which accounted for 55.79 percent of GDP, increased by 5.17 percent in the second quarter.
