BPS also announced that the economy shrank 2.19 percent yoy in the fourth quarter last year, a smaller contraction than in the year’s second and third quarters, when the GDP fell 5.32 percent and 3.49 percent yoy, respectively.

The previous contractions led the country into its first recession in two decades.

“This still shows improvement, even though it might not be what we hoped for. We still need to evaluate what’s working – what needs to be strengthened – so that economic growth can meet our expectations,” BPS head Suhariyanto said during a virtual briefing on Friday.

Finance Minister Sri Mulyani Indrawati said in December 2020 that the government expected a GDP contraction of between 1.7 and 2.2 percent that year, driven by shrinking household spending, which accounts for more than half of Indonesia’s GDP.

This was a downgrade from the September 2020 forecast, when the government projected an economic contraction of between 0.6 and 1.7 percent.

The change in forecast was based primarily on a rise in COVID-19 cases ahead of Christmas and New Year, as well as tighter restrictions that were expected to impact spending. The government made concerted eff orts to ban events likely to gather crowds from Dec. 18 to Jan. 8 to prevent a spike in COVID-19 transmission during the holiday season.

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