The Momentum Of Ramadan And Lebaran Homecoming Potentially Encourages Economic Growth

Rupiah (photo: dock. Antara)

JAKARTA - Executive Director of the Institute for Development of Economics and Finance (Indef) Esther Sri Astuti said that historically Ramadan and Eid is one of the main driving factors for increasing public spending so that it can boost Indonesia's economic growth.

"Ramadan and Lebaran are seasonal factors that boost public consumption and have the potential to increase economic growth," he explained to VOI, Wednesday, April 3.

Esther conveyed that the high enthusiasm of the community to meet the needs during Ramadan would have the potential to increase economic growth.

As for the Central Statistics Agency (BPS) report, Indonesia's economic growth throughout 2023 reached 5.05 percent on an annual basis or year on year (yoy).

In addition, Indonesia's economic growth last year was still supported by household consumption. namely, the source of growth which has a distribution of 53.18 percent of gross domestic product (GDP) grew 4.82 percent.

"People's consumption during Ramadan and Eid is usually more. We know that 53 percent of economic growth is encouraged by household consumption. So this will also have the potential to increase economic growth," he explained.

On the other hand, Esther conveyed that Micro, Small and Medium Enterprises (MSMEs) during Ramadan will also experience an increase in sales.

"MSMEs will also be encouraged to increase their sales. Because people usually don't buy pastries, but this is Eid, so buying pastries. Moreover, the real sector will increase because there is homecoming," he said.

Therefore, Esther hopes that national and regional economic growth will increase because there is public spending in the area during homecoming.

However, Esther said there are still several factors that have the potential to slow down, such as inflation due to rising food prices and rising toll rates and transportation costs.