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ADB slashes GDP growth outlook for Indonesia
The Asian Development Bank has revised down its forecast for Indonesia by 1 percentage point to 3.5 percent this year and expects growth to remain slightly below the pre-pandemic level even next year.
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Out and about: Jakartans take to the streets around the Hotel Indonesia traffic circle to exercise during a Car Free Day (CFD) event on a Sunday in July 2020, after the Jakarta administration restarted the CFD along Jl. Sudirman and Jl. MH Thamrin following an earlier ban to contain the COVID-19 pandemic. (JP/Donny Fernando)
T
he Asian Development Bank (ADB) has slashed its economic growth outlook for Indonesia following the mid-year resurgence in COVID-19 cases and deaths.
For this year, the ADB now expects Indonesia’s economy to grow by 3.5 percent, which is 1 percentage point less than forecast in April. For next year, the development bank has reduced its forecast by 0.2 percentage points to 4.8 percent, signifying a delay in getting back to the typical pre-pandemic growth rate of around 5 percent.
“The main factor behind the [downward revision from] our April forecasts is the outbreak Indonesia went through,” ADB economist Abdul Abiad said in an online press conference on Tuesday, referring to the recent spike in virus cases.
“A big part of that wave in Southeast Asia from June to August was really in Indonesia, and other economies as well. That necessitated restrictions of mobility and economic activity.”
The Manila-based regional development bank also revised down its forecast for Southeast Asia by 1.3 percentage points to 3.1 percent this year and by 0.1 percentage points to 5 percent next year.
