JakartaPost-Nov 7
The newly established National Economic Council (DEN) has suggested that the government strengthen middle-class spending power to sustain economic growth in the fourth quarter. Indonesia’s gross domestic product grew just 4.95 percent year-on-year (yoy) in the third quarter, according to Statistics Indonesia (BPS) data released on Tuesday, continuing a slowdown seen since the beginning of this year with economic growth of 5.11 percent in the first and 5.05 percent in the second quarter. As a result, GDP growth over the first nine months stands at 5.03 percent yoy, casting doubt on the country’s ability to reach the World Bank’s full year forecast of 5.1 percent. DEN deputy head Mari Elka Pangestu highlighted that household spending, which accounts for the majority of Indonesia’s GDP, grew by only 4.9 percent, the lowest rate in the past 13 years. In response, the council provided several recommendations for beefing up economic activity during a meeting with President Prabowo Subianto on Tuesday. “The issue is that food prices remain relatively high, and we are concerned that a [potential] rise in global oil prices could push inflation up. From various numbers, it appears that spending power has weakened. [We need to improve], particularly for the middle class, as lower-income groups already receive direct social aid. We are currently discussing programs to address this,” she said on Tuesday, as quoted by Kompas. Read more at: https://www.
