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Jakarta Post

In upbeat assessment, BI still sees 2020 GDP growth near 5.3 percent

  • Adrian Wail Akhlas

    The Jakarta Post

Jakarta   /   Fri, February 7, 2020   /   03:38 pm
In upbeat assessment, BI still sees 2020 GDP growth near 5.3 percent The logo of Bank Indonesia marks a gate of the central bank on Jl. Thamrin in Jakarta. JP/Rafaela Chandra/sas/19 (JP/Rafaela Chandra)

Bank Indonesia (BI) remains optimistic about economic activity this year, expecting an increase in gross domestic product (GDP) growth to around 5.3 percent, despite last year’s sluggish performance.

BI Deputy Governor Dody Budi Waluyo said on Friday that the central bank would be working with the government to create harmonious policies aimed at boosting investment and exports as global economic prospects were expected to be better in this year’s second half.

"We are still optimistic that economic growth in 2020 will reach 5.1 percent to 5.5 percent and lean toward [the middle of that range at] 5.3 percent," Dody told reporters in Jakarta. He expected household spending, which accounted for more than half of the country’s GDP, to remain strong.

"The latest BI survey shows that consumer confidence will remain positive in the next three to six months. This will support [economic growth]," he went on to say.

Indonesia’s economy grew at a sluggish 5.02 percent last year, the slowest rate since 2015 and below the 5.17 percent achieved in 2018. Investment and household spending both expanded at a slower pace compared to 2018.

Dody noted that the global economic situation had put pressure on economic growth in many countries, including Indonesia, last year.

"We hope that the situation will be better next year,” he added.

In the 2020 state budget plan, the government has set an economic growth target of 5.3 percent for this year. Meanwhile, the International Monetary Fund estimated in October that Indonesia's GDP would strengthen to 5.1 percent this year.