ADB Revised Over Predictions Of Indonesia's Economic Growth To 5 Percent In 2023

JAKARTA - Asian Development Bank (ADB) revised it to the 2023 projection of Indonesia's economic growth. It predicts Indonesia's economy at 5 percent in 2023 which was previously 4.8 percent.

Senior Country Economist of ADB, Henry Ma, assessed that the projection was based on the performance of the Indonesian household consumption sector which tended to improve into the pre-pandemic period.

"For Indonesia, we revised our projection (economic growth) a little bit upward. From 4.8 percent to 5.0 percent," Henry said at the virtual Asian Development Outlook discussion event September 2023 in Jakarta, Wednesday.

"As for Indonesia's economic projection in 2024 ADB, it is still estimated at the level of 5.0 percent," said Henry Ma.

Henry also said ADB revised its projection of Indonesia's inflation rate from the previous 4.2 percent to 3.6 percent. For next year, ADB will continue to maintain Indonesia's inflation projection at 3.0 percent.

Henry explained that the increase in household consumption was due to people's purchasing power which tended to improve along with the economic recovery after the COVID-19 pandemic.

The increase in public spending after the COVID-19 pandemic was also marked by improving community mobility so that many foreign tourists returned to Indonesia.

"Consumption of foreign tourists in Indonesia has increased again. It has even been above the pre-pandemic period," said Henry.

On the same occasion, the Country Director for Indonesia ADB Jiro Tominaga assessed that Indonesia's economic growth of up to 5.0 percent in 2023 was due to domestic demand that took over the role of commodity exports as a driver of growth.

"Healthy growth continues in the first half of 2023, with signs of acceleration, while inflation continues to decline faster than expected as commodity price shocks in 2022 subside," explained Jiro.

The Asian Development Outlook (ADO) is the main report of ADB published twice in one year. The report analyzes economic issues and development in developing countries in Asia. This includes forecasts for inflation rates and growth of gross domestic product for countries in the region.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, and continues its efforts to alleviate extreme poverty. Founded in 1966, ADB consisted of 68 countries.