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Will Indonesia's economy improve soon?

Indonesia’s economic situation is expected to improve soon, as the government is preparing a number of recovery plans, Coordinating Economic Minister Airlangga Hartanto has said. During a virtual discussion entitled “Outlook 2021: Wajah Indonesia Setelah Pandemi” (How Indonesia will look after the pandemic) on Thursdayas quoted by The Jakarta Post, Airlangga said he believed that the nation’s economy had started to pick up. The minister claimed that Indonesia even managed to control the economic impact of the pandemic better than other G20 members.

Indonesia recorded a gross domestic product (GDP) drop of 3.5 percent year-on-year (yoy) in the July-September period that sent the country into its first recession since the 1998 Asian financial crisis. The contraction however was less severe than the 5.3 percent yoy decline seen in the second quarter. Despite the economic optimism, Airlangga assured the public that the government would prioritize health care, saying that it had allocated a large portion of the 2021 state budget for the nation’s health sector, including the national vaccination drive.

In order to improve the economic situation, the government has also launched social protection programs to boost people’s purchasing power. Airlangga explained the government had allocated Rp 48.8 trillion to assist the small enterprise sector in 2021. The Asian Development Bank (ADB) and World Bank have lowered their projections for Indonesia’s economy in 2020. Both institutions expect Indonesia’s economy to contract by 2.2 percent this year, as opposed to previous forecasts of a GDP contraction of 1 and 1.6 percent, respectively.

(source: The Jakarta Post)

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