Economic Outlook

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Contrary to what was expected in the early last year, Indonesia did not fully recovered in 2021 and did not reach its pre-pandemic level of growth. Ending 2021 with GDP growth of 5.02% (y.o.y) in Q4-2021, Overall economic growth in 2021 is recorded at 3.37% (y.o.y). Waves of several Covid-19 variants has served as the hiccups on the economic recovery progress trajectory throughout 2021. Moreover, sectoral performances indicate that the economic recovery got back to its upward track at the end of 2021 after took a hit in Q3-2021 due to the disruption of Delta variant. Several biggest sectors in the Indonesian economy, such as manufacturing, wholesale retail & trade, and agriculture grew robustly in Q4-2021, suggesting the spur in production activity, household demand, and purchasing power of the population. Furthermore, two sectors that has been hit the hardest during the pandemic, namely transportation & storage and accomodation & FnB, enjoyed a significant growth in Q4-2021, thanks to the pandemic containment that enables people to travel and do leisure activities. From the expenditure components, All household consumption components recorded positive growth during the last three months of 2021. Accounted for more than half of the GDP, consumption grew by 3.55% (y.o.y) and government expenditure accelerated by 5.25% (y.o.y) in Q4 2021, which resulted from accelerating budget realization. As of 31 December 2021, government expenditure was recorded at 101.34% of 2021 budget or IDR2,786.76 trillion. At the same time the National Economic Recovery (PEN) budget realization was recorded at IDR658.6 trillion…
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Anticipating the Unexpected: Economic Recovery in the Turbulence Period The domestic spread of Delta variant has dragged down the promising upward trend of economic growth from 7.07% (y.o.y) in Q2 2021 to only 3.51% (y.o.y) in Q3 2021 as consumption declined and business activity in various sectors that relies on physical activity was halted. The implementation of PPKM to limit the transmission of Covid-19 hit severely the transportation & storage and accomodation & FnB sectors. Aside from agriculture, Indonesian main economic sectors, such as manufacturing, wholesale & retail trade, and construction, also experienced slower growth in Q3 2021. The second wave has also slammed brakes on all expenditure components of GDP, particularly the household consumption as the biggest contributor of GDP, which was only grew by 1.03% (y.o.y) in Q3 2021, down from 5.93% (y.o.y) in previous quarter. Amidst the ongoing crisis, credit performance has shown a favourable outlook for overall 2021 as it has gradually increased along with the improved business and consumers sentiment as economic recovery intensifies compared to its ruinous trend during 2020. However, the inflation rate throughout 2021 remains below BI’s target range. The low inflation in 2021 was influenced by domestic demand that was not yet fully recovered. Institute of Economics akan menawarkan 100% konten gratis dengan film hanya melalui sumber tak terbatas ini xvideosxnxx.org, filme porno, filme porno, xnxx1.org, nxnxx.org, filmeonlinehd.biz,…
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Indonesia is officially out of technical recession. Grew by 7.07% (y.o.y) in Q2 2021, Indonesia experienced its highest GDP growth in the last 17 years after suffering economic contraction in the preceding four quarters. Although encouraging, Indonesia’s high economic growth in the second quarter of 2021 is not much of a surprise. There are at least five key elements that play a big part in producing high level of this quarter’s GDP growth. First, the annual rate of Q2 2021 GDP growth is measured in relative to the low base of GDP in the same period of 2020, which recorded a massive contraction of 5.32% (y.o.y). The second factor is the easing of social restrictions. Although the third Large-Scale Social Restrictions (PSBB Jilid III) was in place during Q2 2021, community mobility continued to increase compared to previous quarter. The third factor is the momentum of Ramadan and the celebration of Eid al-Fitr, which falls in the second quarter of 2021. Historically, the quarter in which these two events occurred in almost always recorded the highest GDP growth compared to other quarters throughout the year. The fourth factor is the export side. The underway recovery of several of Indonesia’s main trading partners, such as China and the US, boosted demand for export goods from Indonesia. The last factor that contributed to the rapid GDP growth in Q2 2021 was the continuation of stimulus provided by GoI. In addition to a rather generous social assistance program to protect the poor and…
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Despite still being in negative territory, GDP growth of Indonesia is the closest it gets to the positive rate since the outbreak. Recorded at -0.74% (y.o.y), the Indonesian economy in Q1 2021 enjoyed a less severe contraction in almost all sectors than the previous three quarters. In addition, several sectors that enjoyed a rather positive growth during the pandemic were still recording an expansion in the first quarter of 2021. Diving deeper to its sectors, manufacturing industry as the biggest sector in the Indonesian economy with the contribution of more than a fifth, recorded a growth of -1.38% (y.o.y) in Q1 2021, a rather substantial increase from -3.13% (y.o.y) in the last quarter of 2020. Similarly, wholesale and retail trade as another major sector in the economy with the contribution of 13% to the national GDP, grew -1.23% (y.o.y) in Q1 2021 from -3.66% (y.o.y) in Q4 2020. As PPKM were in place during most of Q1 2021, it comes as no wonder, all expenditure components of GDP shrank, except for government consumption, exports, and imports. Beside disruption coming from Covid-19 pandemic, negative growth in most expenditure components is because we are comparing with Q1 2020 when the pandemic has not fully escalated domestically.…
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The Covid-19 pandemic is a crisis like never before. In economic sense, the current crisis is not originated from any economic aspects like credit crunch, banking sector collapse, or sovereign debt overhang. Thus, we are facing a crisis that has never been explained in any economic textbooks and it leaves almost everyone’s clueless. After more than a year living in a pseudo-dystopic world, we have seen enough calamity to the point extraordinary policy measures and practices to weather the crises is a norm. Excessive sovereign debt accumulation, central banks step-in to fund fiscal policies, and the quickest vaccine development in human history has taken place just to save the population from mounting death counts and help the poorest meet their subsistence.…
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Resuming the pattern of the first half of 2020, Indonesia’s economic figure in Q3-2020 came as a disappointment to many as it was worse than expected. Recorded at -3.49% (y.o.y), the official GDP growth of Q3-2020 practically puts Indonesia in a technical recession. Observing deeper to its sectors, the top four sectors of Indonesia’s economy (i.e., manufacturing, wholesale & retail trade, construction, and mining & quarrying sectors) which accounted for more than half of the GDP, still experienced a negative growth in Q3 2020. While in the expenditure side, almost all of the GDP components contracted except the government spending. The total credit fell sharply to its lowest level in line with the slowdown in business activities and weak consumer demand. The persistent muted core inflation suggests that the the purchasing power remains weak until the end of the year. Despite the deep economic downturn due to the health crisis, Indonesia recorded eight consecutive months of trade suprluses from May to December 2020. The trade performance has released the pressures on Indonesia’s current account balance and Rupiah, where current account balance recorded surplus in Q3-2020 and Rupiah is relatively manageable until the end of the year. However, the series of trade balance surpluses does not represent a better economic outlook as it was spurred by the significant drop in imports due to weak international and domestic demand. There is no promising sign of the real sector recovery as long as the imports, which are mainly consisted of raw and capital…
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Throughout 2020, we observe an overall shallow inflation landscape, as made apparent by its inflation rate being the lowest in many years before (1.68%). The most important contributor to such a decrease in inflation is the administered inflation, for whic h we have observed a decrease of 0.26 bps from last year. The core inflation rate also contributes to an even more significant decrease at 1.6 bps lower than the preceding year.…
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