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Employers keep growth expectations low amid global slowdown
The Indonesian Employers Association predicts that the country's economic growth will remain sluggish next year as the global economic slowdown continues to affect domestic business activity.
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Apindo chairman Hariyadi B. Sukamdani talks to the press at the Apindo headquarters in Jakarta on Tuesday. The association estimates Indonesia’s 2020 GDP growth at between 4.85 and 5.1 percent. (The Jakarta Post/Eisya Eloksari)
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The association expects the country’s economy to grow at a rate of only 4.85 percent to 5.1 percent in 2020, below the government’s target of 5.3 percent. Meanwhile, for this year, the association has lowered its projection to between 4.95 percent and 5.1 percent from its initial forecast of 5.2 percent.
The association’s chairman, Hariyadi B. Sukamdani, said uncertainties in the global economy as a result of the escalating trade war between the United States and China would continue to hamper Indonesia’s exports, one of the major drivers of the country’s economic growth.
“Although, if the omnibus law can be implemented and [provide lots of employment opportunities in 2020], we think that reaching 5.1 percent is a possibility,” he told journalists at a press conference in Jakarta on Tuesday.
The association is pinning high hopes on the planned omnibus law on job creation, scheduled to be implemented by the middle of next year, so that it can increase investment, which could in turn produce additional economic output and create more jobs.
The planned law, which would revise more than 70 overlapping laws, would put an emphasis on simplifying business licensing and investment processes in the country as part of a broader effort to improve competitiveness.
Hariyadi also said that the 2019 growth prediction was lower than the association's projection of 5.2 percent made last year because of the widening current account deficit and the decline in economic activity during the presidential elections in April.
