Bambang Brodjonegoro: Low Productivity Rate Is One Of The Causes Of Indonesia's Economic Growth To Slow Down

JAKARTA - The productivity level of the Indonesian people is recognized as still low. This is also one of the causes of Indonesia's economic growth tends to slow down.

This was conveyed by the Presidential Special Advisor for Economics and National Development Bambang Permadi Soemantri Brodjonegoro in his remarks at the 17th Graduation event of STIE Indonesia Banking School (IBS) in the Mampang area, South Jakarta, Saturday, November 23.

"It must be admitted that Indonesia's productivity level is still low when compared to countries that manage to get out of the middle income trap or middle income trap," he said.

The former Minister of Finance said, based on data from Total Factor Productivity (TFP), Indonesia during 2005-2019 experienced negative growth of 0.66.

He said this achievement was even relatively lagging behind when compared to South Korea, which was able to reach 1.61 when it was still in the process of heading to developed countries in the period 1971-1995.

Then, the value of Indonesia's productivity achievement was far behind China, which reached 1.60 in almost the same period.

"This low productivity also has a direct impact on Indonesia's economic growth which tends to slow down," he said.

Bambang explained, during the 2005-2010 period, the Indonesian economy was able to grow an average of 5.7 percent. However, he said, this growth slowed to an average of 4.7 percent in the 2010-2015 period.

Then, in the 2015-2019 period, Indonesia's economic growth increased again to an average of 5 percent and reached 5.3 percent in 2022.

"Low productivity has led to a decline in Indonesia's potential economic growth," he said.