BI Is Optimistic That Indonesia's Economic Growth In 2021 Will Be At The Level Of 4.3 Percent To 5.3 Percent

Bank Indonesia. (Fofo: Special)

JAKARTA - Bank Indonesia (BI) estimates that Indonesia's economic growth throughout 2021 will be in the range of 4.3 percent to 5.3 percent.

BI Governor Perry Warjiyo expressed that optimism was based on export projections which were believed to increase in line with commodity price growth at the beginning of this year.

"BI also sees the government as aggressive in making state expenditures for the economic election process," he said at the Stakeholder Meeting for the Acceleration of National Economic Recovery which was broadcast virtually on Thursday, March 25.

Perry added that the central bank also sees that the enforcement of the Job Creation Law is considered to provide fresh air in moving the economy.

"The Job Creation Law has the potential to bring in investment and this is a good momentum for recovery," he said.

In terms of the financial services industry, Perry revealed that the current banking conditions are considered to be well maintained. This is evidenced by an adequate capital adequacy ratio and abundant liquidity. In addition, the inflation rate remains sloping with a reference of 3 percent plus minus 1 percent.

"Then our foreign exchange reserves are quite large with a value of 138 billion US dollars. Not to mention the interest rate policy which remains low with 3.5 percent which is the lowest in history, "he explained.

On this occasion, he also described BI's efforts in relation to sharing the burden of state financing through the burden sharing mechanism.

"We support the government through the purchase of Government Securities (SBN) to finance the state budget," he said.

According to VOI's records, until March 16, 2021, BI had purchased SBN of IDR 65.03 trillion. Of this amount, Rp. 22.9 trillion was reached through the main auction mechanism, and Rp. 42.13 trillion through the Greenshoe Option (GSO) method.

Meanwhile, in 2020 the monetary authority has purchased SBN from the primary market amounting to IDR 473.42 trillion.

"Right now, what we are focusing on is how to encourage an increase in credit to be able to encourage faster economic recovery," concluded Perry.