The heated situation of the trade war between the United States (US) and China may bring about an impact on Indonesia's national economic growth. Moreover, the US has raised China's import tariffs to 25 percent more recently. According to some observers, at present, the global conditions make Indonesia's economic growth this year projected to only reach around 5.1 percent or below the government's target set in the 2019 State Budget (APBN), which is 5.3 percent. The argument put forward is that the trade war has made the demands of both countries, the US and China decline and the prices of major export commodities are also low.
On the contrary, the government is optimistic that this year's economic growth target of 5.3 percent can still be achieved, even though the temperature of the trade war between the United States and China is increasingly heating up. What is the basis of the government's belief that 5.3 percent economic growth can be achieved?
The realization of economic growth in the first quarter of 2019 compared to the first quarter of 2018, which was maintained positively, seems to strengthen the optimism. To achieve the economic growth target, the government is now committed to encouraging the export of a number of priority industrial groups, especially what has been decided by the Ministry of Industry in Industry 4.0. Five priority industry groups are included in Industry 4.0. They are food and beverage industry, textiles and clothing, electronics, automotive, and the chemical industry. In addition, the government is also committed to encouraging the processing of natural resources such as the construction of smelters and processing of palm oil. These efforts make the government optimistic that the 5.3 economic growth target can be achieved this year.