Finance Minister of Indonesia, Chatib Basri, expects the Indonesian economy to grow 5.3 percent (year-on-year, yoy) in the second quarter of 2014 because of improved household consumption supported by the legislative and presidential elections in 2014. Meanwhile, Indonesian exports are also expected to have improved slightly from its performance in the first quarter of the year due to improved economic conditions in Europe. However, demand from China and Japan remained sluggish. In Q1-2014, GDP growth slowed to 5.21 percent (yoy).

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Ahead of the release of the Indonesian government’s official June consumer confidence report (expected to be released today), a survey conducted by the Danareksa Research Institute shows that Indonesian consumer confidence may have weakened 0.3 percent to 94.8 points in June 2014 amid concern about job availability and an expected slowdown in economic growth of Indonesia for the six months ahead. A reading below 100 points indicates pessimism, while a reading above 100 points indicates optimism.

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The Indonesian government is optimistic that the country’s economic growth will accelerate to 5.8 percent (year-on-year) in 2015 from an expected growth pace of 5.5 percent in 2014. The key to next year’s improved gross domestic product (GDP) growth of Indonesia is the higher forecast for global economic growth. In 2015, the world economy is estimated to grow 3.9% (yoy), higher than the outlook for this year’s growth at 3.6 percent. As such, the government’s outlook is in line the central bank’s GDP growth forecast in the range of 5.4 to 5.8 percent.

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The Governor of Indonesia’s central bank (Bank Indonesia), Agus Martowardojo, said that the Indonesian economy can grow more than six percent provided that several important structural reforms will be implemented in order to avoid the middle income trap. This trap occurs when rapidly growing economies stagnate at middle-income levels for many years, thereby failing to reach a high income level (as has been the case with Brazil, Mexico, South Africa and other middle income countries from the early 1980s to the mid-2000s).

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Indonesian car exports may reach 310,000 vehicles in 2014, a 12.72 percentage point growth from last year (275,000 vehicles). Exports of completely built up (CBU) units are expected to number 200,000 while completely knocked down (CKD) units are estimated to reach 110,000 units by the year-end. Indonesian Industry Minister MS Hidayat confirmed that the automotive industry of Indonesia has shown good performance. Currently, Indonesian automotive products are exported to a total of 80 countries.

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On 15 June 2014, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic topics such as the central bank’s benchmark interest rate policy, car sales, foreign investment, a rupiah exchange rate update, the latest news concerning the presidential elections of 2014, and more.

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Indonesian Finance Minister Chatib Basri said that the country's current account deficit, the broadest measure of international transactions, may widen in the second quarter of 2014 as many local companies engage in business expansion. Such expansion usually triggers an increased amount of imports, thus impacting on the trade balance. A widening current account deficit in the second quarter of the year is a normal trend. The balance usually improves in the third and fourth quarters.

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The non-oil & gas industry of Indonesia grew 5.56 percent in the first quarter of 2014. Although general economic growth in Southeast Asia's largest economy has slowed to 5.21 percent in the first quarter, several industries such as the Food and Beverage Processing Industry, the Transportation Equipment Industry, Machinery & Equipment Industry, as well as Farming & Plantation-based Industries post strong growth. The Indonesian Industry Ministry targets a 6.5 percentage rate for the country's industrial sector in 2014.

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The start of the ASEAN Economic Community (AEC) in 2015 will turn the ASEAN region into a strong economic block. However, the region should enhance political stability and foster economic justice. These are the two basic conclusions drawn in the World Economic Forum on East Asia in Manila (the Philippines) on Thursday (22/05). This forum is a meeting place for state leaders, global businesses, politicians as well as scholars. Indonesian President Susilo Bambang Yudhoyono was one of the attendees.

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The Indonesian government announced to revise its GDP growth target for 2014 after seeing the disappointing economic growth result in the first quarter of 2014. Last week, Statistics Indonesia (BPS) had announced that GDP growth in Q1-2014 only amounted to 5.21 percent, far below official growth targets as well as analysts' forecasts. Indonesia's slowing growth was caused by slowing exports, brought on by the slow global recovery, China's slowing economy and the temporary impact of the ban on exports of unprocessed minerals.

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Across the world, concern over the COVID-19 pandemic grew in September 2020 as the number of new COVID-19 cases continued to rise rapidly. Worldwide, at the end of September 2020, some 34 million people have been infected with the virus, while more than one million people have died after contracting the virus.

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On 05 August 2020, Statistics Indonesia (BPS) released Indonesia’s gross domestic product (GDP) data for the second quarter of 2020. These data, which were highly anticipated among analysts and policymakers, are crucial to comprehend how – and to what extend – the self-imposed social and business restrictions (made in response to the COVID-19 pandemic) have impacted on the Indonesian economy.

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Good news at the start of July 2020. The World Bank upgraded Indonesia’s economic status to an ‘upper-middle income country’ (from ‘lower-middle income country’) per 1 July 2020. The key consideration for the World Bank was that Indonesia’s gross national income (GNI) per capita increased from USD $3,840 in 2018 to USD $4,050 in 2019. This means that an upgrade was needed (see the table below).

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It is becoming clearer by the day that economic growth in Indonesia, in 2020, will be derailed enormously. Analysts and authoritative institutions (both international and domestic ones) have, again, cut their forecasts for Indonesia’s economic growth in Q2-2020 (decisions that obviously also have consequences for Indonesia’s full-year 2020 economic growth outlooks).

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The most recent published outlooks for global economic growth and global trade are more pessimistic than their earlier versions, with the main reason being that there is no quick solution to the coronavirus (COVID-19) crisis. On the contrary, there is a high degree of uncertainty about when business can resume as usual. And, the closer we get to 2021, the less rosy outlooks are becoming for next year.

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The novel coronavirus (COVID-19) crisis has a wide range of economic and social consequences. For example, the Indonesian economy is likely to contract this year (for the first time since 1998), while millions of Indonesians have lost their jobs over the past three months, and the majority of the country’s enterprises have seen their sales plunge.

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On 5 May 2020 Statistics Indonesia (Badan Pusat Statistik, BPS), a non-departmental government agency, released the first quarter gross domestic product (GDP) data of Indonesia for the year 2020. These data were highly anticipated as policymakers, analysts, and stakeholders are particularly interested in finding out to what extent damage has been done to the Indonesian economy by the self-imposed restrictions.

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The economic and social consequences of the COVID-19 crisis are becoming increasingly clear and frightening. All the self-imposed restrictions on business and social behavior, taken by governments across the world, may protect people’s health to a significant extent, but the policy measures also have devastating economic and social consequences as economic activity nosedives, and businesses collapse. This results in unprecedented mass layoffs as well as growing poverty.

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In mid-April 2020 the International Monetary Fund (IMF) released its latest ‘World Economic Outlook’ report. It is in fact not a complete report. Considering the global economy has changed dramatically over the past months, the IMF’s previous update of the World Economic Outlook (released in January 2020) simply had no validity anymore, and therefore the IMF released one new chapter in mid-April 2020 (with the full report set to follow in May 2020).

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The number of confirmed novel coronavirus (COVID-19) infections and fatalities have been growing steadily across Indonesia in recent weeks, especially in the capital city of Jakarta where around half of the country's total COVID-19 cases originate from. And the alarming matter is that this could very well be the beginning of the real storm.

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