Saturday, September 30, 2023

ADB Upgrades Indonesia's Growth Projection to 5.2% in 2022 Amid Developing Asia Slowdown

Jakarta Globe
July 21, 2022 | 1:43 pm
SHARE
People trade chili at Senen Market, Central Jakarta, on June 2, 2022.
(B1 Photo/Joanito De Saojoao)
People trade chili at Senen Market, Central Jakarta, on June 2, 2022. (B1 Photo/Joanito De Saojoao)

Jakarta. The Asian Development Bank, or ADB, has revised up its growth forecast for Indonesia to 5.2 percent this year, reflecting the country's robust domestic consumption and windfall revenue from high global commodity prices. 

The latest projection was 20 basis points higher than the multinational lender's previous forecast in April of 5.0 percent.

"Economic activity in Indonesia continues to normalize while Covid-19 infections remain manageable, despite a recent rise in the number of cases," Jiro Tominaga, ADB's country director for Indonesia, said in a statement Thursday. 

Still, the supplement projected the largest economy in Southeast Asia would experience higher inflation this year at 4.0 percent, compared to ADB's 3.6 percent projection in April, due to high commodity prices.

Advertisement

"Inflation has risen, hurting households' purchasing power. However, high prices for key commodity exports are generating windfall export earnings and fiscal revenue, enabling the government to provide aid for costlier food, electricity, and fuel while still reducing the budget deficit," Tominaga said. 

Indonesia's economy expanded 3.69 percent in 2021 after shrinking xx percent a year earlier due to restricted economic activities needed to curb the pandemic. 

The country has so far managed to control the spread of Covid-19, with daily new cases averaged at 5,100 per day, far lower than its neighbors in the region. 

Indonesia's 2022 growth acceleration was one of the highlights of the lender's Asian Development Outlook (ADO) 2022 Supplement, released Thursday.

It would be one of the few countries in developing Asia and the Pacific to shield itself from China's economic slowdown, advanced economies' aggressive monetary tightening, and the prolonged Russian invasion of Ukraine this year. 

ADB lowered its economic growth forecast for developing Asia and the Pacific to 4.6 percent this year, from its previous projection of 5.2 percent. 

"The economic impact of the pandemic has declined across most of Asia, but we're far from a full and sustainable recovery," ADB Chief Economist Albert Park said.

"On top of the slowdown in the PRC, the fallout from the war in Ukraine has added to inflationary pressure that's causing central banks around the world to raise interest rates, acting as a brake on growth. It's crucial to address all these global uncertainties, which continue to pose risks to the region's recovery," Park said. 

Tags: Keywords:
adb
SHARE

POPULAR READS


News 20 hours ago

77 Indonesians Could Be Spared Death Penalty in Malaysia

Malaysia recently decided to scrap the mandatory death penalty for a range of serious crimes, including drug trafficking and murder.
Tech 22 hours ago

South Korean League of Legends Team Wins Gold at Asian Games

Esports was first featured at the last Asian Games in Jakarta, Indonesia, as a demonstration sport and proved incredibly popular.
News 23 hours ago

Jakarta Governor Clarifies Social Media Post Regarding Seawall Cracks

He clarified that the video shared on social media was an old one, showing an embankment wall in Kalibaru.
News 23 hours ago

US Government Shutdown Almost Certain

McCarthy’s right-flank Republicans refused to support the bill despite its steep spending cuts of nearly 30 percent to many agencies.
Business Sep 29, 2023 | 9:21 pm

GPS Distributor Sumber Sinergi Holds IPO

Sumber Sinergi is a distributor of global positioning system devices for automobiles that also offers installation services.
COPYRIGHT © 2023 JAKARTA GLOBE. ALL RIGHTS RESERVED