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Monday, 09 August 2021 08:43

Indonesia Gets Out of the Economic Crisis

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There was good news for the Indonesian people last week. The Central Statistics Agency [BPS] announced on Thursday (5/8) that Indonesia's economic growth in the second quarter of 2021 or the April-June period reached 7.07 percent on an annual basis and 3.31 percent on a quarterly basis. This positive growth has pushed Indonesia out of a recession due to negative growth that occurred  in the second quarter of 2020 due to the Covid-19 pandemic.

According to Head of the Central Statistics Agency, Margo Yuwono, Indonesia's economic growth in the second quarter was better than the first quarter of 2021. Meanwhile, in the same period last year, it was minus 5.32 percent. He also explained that apart from the onset of economic recovery, another factor for the second quarter's economic growth was the low base effect of last year's growth. In addition, economic growth was also driven by an increase in exports. Indonesia's total exports were recorded at US$53.97 billion, up 10.36 percent compared to the previous quarter. According to Margo Yuwono, the global economy in the second quarter also experienced an increase. This could be seen from the movement of the Purchasing Manufacturing Index in March and June 2021, which continues to increase.

Coordinating Minister for Economic Affairs, Airlangga Hartarto said that the government's next homework is to further increase efforts to control the Covid-19 virus. Even though the number of positive cases of Covid-19 has started showing a decline, it has not been fully resolved. The engine of growth, according to Minister Airlangga Hartarto, has moved and is growing positively, while the global potential has also moved.

Meanwhile, according to Minister of Finance Sri Mulyani, one of Indonesia's successful economic recovery strategies came from social assistance. It is able to maintain the level of poverty and household consumption of the lower class. She hopes that the recovery in consumption will also spread to the upper middle class.

Hopefully, with the right fiscal and monetary policies, accelerated vaccination, provision of social assistance, and discipline from all parties in strictly implementing health protocols, the momentum of economic growth will continue until the third quarter, which is predicted to be around 3.7-4.5%.

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