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View all search resultsLimited options for pushing GDP
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A stall worker uses his phone while waiting for customers on March 6, 2025, at a clothing shop in Tanah Abang Market in Central Jakarta. (AFP/Bay Ismoyo)
T
here is only so much the government can do to prop up economic activity, no matter how dear the gross domestic product growth figure is to President Prabowo Subianto.
Annual GDP growth has averaged around 5 percent over the past two decades, so much so that that figure has become a de facto benchmark and a crude gauge in public discourse for government performance, where failing to achieve that rate is seen as missing the mark but reaching it is deemed passable.
There are, of course, all sorts of issues with using a single figure as shorthand for the success or failure of economic policymaking. The quantitative indicator measures economic activity but says little about the quality, distribution or sustainability of that activity.
But even if the focus remains squarely on that number, there is a problem, it is not big enough.
The government itself has contributed to the media’s fixation on GDP growth with its promise to push the rate to 8 percent by the end of Prabowo’s term.
Previous administrations, too, have proclaimed goals that require more than 5 percent, notably the Golden Indonesia 2045 vision formulated by then-president Joko “Jokowi” Widodo in 2019, which aimed to make Indonesia a top-five economy by its centenary of independence.
Viewed in that light, the third-quarter economic data announced last week is not good enough, even though we just about held the 5 percent line with year-on-year (yoy) GDP growth of 5.04 percent, down from a surprisingly strong 5.12 percent in the second quarter.
