The Indonesian economy is expected to grow in the range of minus 2 percent to positive 0.6 percent in the fourth quarter of this year, Coordinating Minister for Economic Affairs, Airlangga Hartarto, said.
The projected growth could be achieved if the momentum for recovery that began in the third quarter, when the economy showed a smaller contraction of 3.49 percent compared to 5.32 percent in the second quarter, is maintained, Airlangga stated.
"This shows a quarter to quarter growth of 5.05 percent. If we can maintain this momentum, the growth in the fourth quarter is estimated to be minus 2 percent to positive 0.6 percent,” he said at the 2020 Bisnis Indonesia Award event in Jakarta on Monday.
Economic growth data for the second and third quarter have shown that Indonesia has begun to bounce back after hitting rock bottom, so the chance for recovery needs to be maintained, he stressed.
Indonesia has an opportunity for economic recovery and positive growth of 0.6 percent given the increase in domestic demand and consumer confidence, as reflected in increased household consumption, the minister explained.
"Economic improvement in developed and developing countries related to the Purchasing Managers Index (PMI) (shows) manufacturing in various countries has started to be positive, and in Indonesia it has also reached 50.6," he said.
Not only that, the inflation rate that was maintained at the level of 1.59 percent (yoy) in November could also be a driving force for better growth in the fourth quarter, he added.
Several other sectors are also likely to contribute to positive growth, such as agriculture, plantations, education, information and telecommunications, health, and social activities, he said.
"In addition, the manufacturing, trade and consumption industries, which have a big contribution to GDP, (are) also experiencing positive (growth),” he noted.
Meanwhile, in the financial market, despite a decline, the JCI (Jakarta Composite Index) indicator has returned to its pre-COVID-19 level of 5,900, and the rupiah exchange rate has strengthened again by Rp14,100, Hartarto observed.
"We see that the flow of capital has returned to Indonesia, and of course, this is a confidence that continues to be encouraged and shows real sector activity (is likely) to boost economic growth in 2021," the minister said.
Furthermore, from an external perspective, it shows that a positive trade balance will continue in 2020, he added. The trade surplus stood at US$3.61 billion in October, and was recorded at US$17.07 billion for the January-October period.
"It shows the resilience of our external sector, and we encourage optimism with our foreign exchange reserves of US$130 billion, showing that our financial sector has the same resilience," Hartarto remarked.
Therefore, he said, he is optimistic that 2021 would serve as an opportunity for the national economy to manage a full recovery due to increasing economic activity.
“(With) The health protocol that we continue to maintain, the government believes that 2021 will be a year of recovery. (It is expected to be) A year that provides opportunities for the national economy so that our national economy can move,” he said. (antaranews)