Thursday, September 28, 2023

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

Jakarta Globe
July 21, 2022 | 1:43 pm
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.


"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:


Special Updates 6 hours ago

Pertamina's Balikpapan Refinery Master Plan Reports 82 Pct Progress

The Balikpapan refinery master plan is expected to help Indonesia cut down its oil fuel imports.
News 8 hours ago

Nagorno-Karabakh Gov't to Dissolve Itself by January 2024

The move comes after Azerbaijan carried out a lightning offensive to reclaim full control over its breakaway region.
Special Updates 22 hours ago

Annual Culinary Fest 'Pasar Senggol' Returns to Summarecon Mall Bekasi

With 114 tenants at 99 booths, four food trucks, and 11 food carts, visitors have thousands of menu choices to explore.
News 22 hours ago

Anies and Muhaimin Visit Rizieq

The presidential candidate and his running mate attended the wedding of Rizieq's daughter in Petamburan.
News Sep 27, 2023 | 5:53 pm

Prabowo in 'Final Phase' of Selecting Running Mate

Among the three possible candidates for the presidential race, Anies Baswedan was the first to unveil his running mate.