World Bank projections on Indonesian economy to be met in 2017
World Bank projections | The World Bank has kept its projections for Indonesia’s economic growth this year 5.2% and next year 5.3%.
We’re seeing faster economic growth, Rodrigo Chaves, the World Bank’s country director for Indonesia told.
The World Bank projections lauded Indonesia economy growth progress so far, crediting steady growth, growing consumption, tame inflation, accommodative monetary policy, narrow current account deficit and strong fiscal performance.
World Bank Sees Faster Economic Growth for Indonesia
The World Bank noted in its “Indonesia Economic Quarterly: Upgraded” report that global growth is expected to start picking up in both advanced and emerging market economies which benefit from ongoing commodity prices recovery and global trade rebound. Global growth is expected to reach 2.7 percent this year and then accelerate to 2.9 percent in 2018-2019.
The World Bank projections show Indonesia to continue its structural reforms including increasing its tax-to-GDP ratio and reducing the level of restriction on negative investment to spur much-needed foreign direct investments.
Government spending expanded 2.7 percent in the first quarter of this year from a contraction of 4 percent in the fourth quarter last year. Meanwhile, private consumption rose 5 percent in the first quarter, the same pace as was recorded in the fourth quarter last year.
Inflation has also been kept well within Bank Indonesia’s range of 3 percent to 5 percent.
“Monetary policy has remained accommodative with the central bank keeping policy rate on hold for the seventh consecutive month, after last year’s series of six policy rate cuts that eased a total of 150 basis points,” the report said.
Bank Indonesia, the country’s central bank, will reveal the result of its policy meeting later today.