Sorry Pak Jokowi, Bank Mandiri Predicts 6 Percent Economic Growth In The Second Quarter, Not 7 Percent

JAKARTA - PT Bank Mandiri Tbk. estimates that Indonesia's economic growth in the second quarter of 2021 will be at the level of 6 percent.

Chief Economist of Bank Mandiri Andry Asmoro said that although the growth rate in the first quarter of 2021 is still plunging to minus 0.74 percent year-on-year (yoy), he believes that various indicators are starting to show improvement, especially in the March and April period.

"This indicates that the trend of economic recovery continues, supported by front-loading stimulus and government capital expenditures as well as being influenced by rising exports in line with the recovery in global commodity prices," he said in his presentation broadcast online, Wednesday, May 19.

According to Andry, another aspect that has become a positive signal for recovery momentum is that the level of public confidence is starting to recover which is influenced by the decline in the number of daily COVID-19 cases and the start of the vaccination process.

"The second quarter also coincided with the momentum of Ramadan, which triggered an increase in consumer spending," he said.

In terms of intermediation, support from Bank Indonesia through an accommodative policy by setting a reference interest rate of 3.5 percent is considered to have increasingly stimulated economic activity in the community.

"With the latest developments, we estimate that the economic growth will be positive in the second quarter above 6 percent, and can grow at 4.4 percent for the whole year," he said.

Previously, President Joko Widodo (Jokowi) during a visit to Bekasi Regency on Tuesday, May 18 was optimistic that Indonesia's economic growth rate could reach 7 percent in the second quarter of this year.

"It is hoped that in the second quarter of 2021 it can meet the target, which is approximately 7 percent," he said on the sidelines of the Mutual Cooperation Covid-19 Vaccination review for Workers.

Meanwhile, economic growth for 2020 according to data released by the Central Statistics Agency (BPS) is minus 2.07 percent on an annual basis.

The spatial structure of the Indonesian economy in 2020 is dominated by a group of provinces in Java Island at 58.75 percent, with economic performance experiencing a growth contraction of minus 2.51 percent.