Ambyar! Bank Indonesia Crop Targets Economic Growth 2021 To Be A Minimum Of 3 Percent

JAKARTA - Bank Indonesia (BI) estimates that this year's economic activity will experience greater pressure than previously predicted. This is reflected in BI's correction of the growth target from 4.8 percent to 5.8 percent to 3 percent to 5.3 percent.

BI Governor Perry Warjiyo said this assumption was generally based on weak domestic demand.

"Especially due to weak private consumption and building investment as a result of limited mobility due to the COVID-19 pandemic," he said in a virtual press conference after the Board of Governors Meeting, Thursday, February 18.

Perry added that in the fourth quarter of 2020, Indonesia's economy contracted by minus 2.19 percent on an annual basis.

"Although lower than expected, the economy in the fourth quarter of 2020 improved with a lower contraction than the previous quarter of minus 3.49 percent," he said.

Furthermore, the central bank boss remains optimistic that domestic economic recovery is expected to continue in line with the global economic recovery and the acceleration of the national vaccine program by the government.

Meanwhile, sectors that are expected to be a catalyst include CPO, coal and steel, as well as a number of manufactured products such as organic chemicals, motor vehicles and footwear, which will then boost sectoral performance.

"Improvements in export performance were recorded in a number of regions, particularly Sulampua (Sulawesi, Maluku, Papua), Java and Sumatra. Meanwhile, to encourage the still weak domestic demand, the synergy of national economic policies will continue to be strengthened, "he said.

For this reason, his party has prepared five important aspects that will be jointly managed with the government, namely the opening of productive and safe sectors, accelerating fiscal stimulus, channeling bank credit from the demand and supply sides.

Then, the continued monetary and macroprudential stimulus, as well as the acceleration of economic and financial digitization, particularly related to the development of MSMEs.

"Bank Indonesia will continue to synergize policies through the Financial System Stability Committee (KSSK) in order to accelerate national economic recovery," said Perry.

For information, the government through the Ministry of Finance is aiming for economic growth at the level of 4.5 to 5 percent throughout 2021. Until this news was published, there has been no information on changes from the institution led by Sri Mulyani.