Minister of Finance Sri Mulyani Indrawati stated that Indonesia was able to maintain strong economic growth in the first quarter of 2024. Where, the Indonesian Economy in the first quarter of 2024 grew 5.1 percent year-on-year (yoy).
"In the midst of global uncertainty, the Indonesian economy can continue to show its resilience, as can be seen from the growth achievements in the first quarter," Sri Mulyani said quoting Antara.
On the expenditure side, household consumption and Non-Profit Institutions Serving Households (LNPRT) grew by 4.9 percent and 24.3 percent (yoy), respectively.
The growth in household consumption is still strong, mainly driven by controlled inflation, increasing economic activity during Ramadan, increasing the salaries of state civil servants (ASN), and providing holiday allowances (THR).
"Indirectly, government spending related to the implementation of elections also encourages household consumption through the provision of honorarium for election officers. Meanwhile, consumption by LNPRT has soared, especially driven by various activities related to the 2024 election," he explained.
Meanwhile, the Government Consumption Expenditure (PKP) grew double digits by 19.9 percent (yoy). This growth was influenced by the increase in ASN salaries, the provision of THR, goods expenditure, and social spending. PKP contributed 1.1 percent to the third largest economic growth in the first quarter of 2024 after public consumption and Gross Fixed Capital Development (PMTB).
PMTB growth or investment was recorded at 3.8 percent (yoy), which is supported by government capital expenditure activities related to infrastructure. The sustainability of SDA downstreaming is increasing, the macroeconomic performance is very good, and socio-political stability maintains Indonesia's attractiveness as an investment destination.
The investment performance of the private sector is also reflected in the realization of Foreign Investment and Domestic Investment in the first quarter which grew by 22.1 percent (yoy) with a balanced distribution of investment between Java and outside Java.
The trend of global economic slowdown has affected Indonesia's export and import growth. In the first quarter of 2024, real exports still grew by 0.5 percent (yoy) supported by the increase in service exports in line with the strong flow of foreign tourist visits to Indonesia.
On the other hand, the export volume of main products such as steel iron and mineral fuel remains strong, growing by 35.8 percent and 5.4 percent (yoy) in the first quarter of 2024, respectively. Meanwhile, real imports also grew 1.8 percent (yoy) in the first quarter of 2024. Overall, the contribution of net exports (exports) to growth contracted by 0.2 percent.
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According to the Minister of Finance, there are still several global risks that still have to be faced in the future, such as the Fed's policy direction, geopolitical tension escalation, and disruption of global supply chains that have not fully recovered.
As an anticipatory measure for these various global dynamics, Sri Mulyani ensured that the monetary authority and the financial sector would continue to strengthen synergy and coordination to maintain national economic stability.
"The government will continue to monitor and assess the potential impact of the global dynamics on the domestic economy and fiscal conditions. The state budget will continue to be optimized as a shock absorber to maintain people's purchasing power and momentum for economic growth," said Sri Mulyani.
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