The Indonesian Economy Is Predicted To Grow 5.06 Percent In 2024

Indonesia's Economic Growth (Photo: Antara)

JAKARTA - PT Bank Mandiri (Persero) Tbk (BMRI) projects Indonesia's economic growth to reach 5.06 percent by the end of 2024.

Bank Mandiri Treasury & International Banking Director Eka Fitria said the main reason the company is optimistic about this year's growth is based on the relatively solid economic performance so far.

"Indonesia's macroeconomic economy is still strong, the economic performance in the second quarter of 5.05 percent is relatively strong despite slowing down compared to the first quarter. Economic growth is supported by public consumption and investment," said Eka quoting Antara.

Eka explained that the decline in the benchmark interest rate from Bank Indonesia (BI) and the US central bank (The Fed) would increase global liquidity that supports economic growth.

This is reflected in the data in which in the last few weeks, many foreign capital has been included in Indonesia's investment instruments.

Meanwhile, based on the Mandiri Lending Index, public spending was relatively stable throughout the third quarter of 2024. Public consumption was still driven by the lifestyle sector, especially from groups of young people.

"Young age groups are an important driving factor in economic growth after the pandemic," he said.

Then sectorally, Indonesia's economic development shows a strong trend with the support of increasing the mobility sector such as hotels, restaurants, transportation and warehousing. In addition, the entertainment services sector is also an aspect that also supports economic growth.

Bank Mandiri Chief Economist Andry Asmoro explained further that the average economic growth in Indonesia in the range of 5 percent is quite good compared to other countries.

However, if the Government is aiming to get out of the trap of middle-income traps, Andry believes that economic growth needs to be increased even higher.

"This is relatively sufficient compared to other countries, but to have an impact on poverty alleviation and getting out of the middle-income trap, economic growth must be increased," explained Andry.