JAKARTA - The International Monetary Fund (IMF) projects Indonesia's economic growth to be in the range of 5 percent in 2026, slightly lower than the previous estimate of 5.1 percent.
The projection is listed in the April 2026 World Economic Outlook report.
This decline is influenced by the impact of the conflict between the United States and Iran which has pushed up the price of various commodities, especially energy.
In its report, the IMF explained that the global economy is facing direct pressure from the surge in commodity prices, as well as the subsequent impact in the form of increased inflation expectations that are very sensitive to energy and food prices.
In addition, risk aversion sentiment in the financial market also magnified the impact.
"The global economy is facing direct impacts from rising commodity prices, second-order indirect effects on inflation expectations which tend to be very sensitive to energy and food prices and amplification effects stemming from risk aversion sentiment in financial markets," the report wrote, quoted Monday, April 20.
In addition, developing countries, especially those that rely on commodity imports, have the potential to experience greater pressure, and exchange rate depreciation exacerbates the impact of rising energy and food prices in these countries.
The IMF assessed that the global economic impact depends heavily on the duration, intensity, and scope of the conflict, which is still difficult to predict.
In the Southeast Asian region, Vietnam is expected to record the highest growth of 7.1 percent in 2026, Indonesia of 5 percent, Malaysia of around 4.7 percent, the Philippines of 4.1 percent, and Thailand of 1.5 percent.
In the baseline scenario, the IMF assumes the conflict lasts only a few weeks, followed by a gradual recovery by mid-2026.
With this assumption, disruptions to production and exports are expected to ease and return to normal by mid-year.
However, the IMF warned of the possibility of a worse scenario if the conflict lasts longer and intensifies.
Globally, world economic growth is expected to slow to 3.1 percent in 2026, down from 3.4 percent in 2025.
This slowdown occurs in tandem with the projected increase in energy commodity prices by 19 percent, oil prices are expected to jump by 21.4 percent due to production and distribution disruptions in the Middle East region, with an average of around 82 US dollars per barrel.
Meanwhile, natural gas prices are predicted to experience greater pressure due to technical constraints in restoring production and relatively limited reserves.
The increase in energy prices also has an impact on food prices, as the cost of fertilizer, transportation, and disruption of global logistics routes increase.
On the other hand, the prices of base metals and precious metals are expected to continue the upward trend since 2025.
The IMF assessed that without conflict, the global economy could actually remain stable in 2026 thanks to the resilience of a number of countries.
However, the current geopolitical situation is increasing uncertainty and weighing on growth prospects.
In addition, disruptions such as the closure of the Strait of Hormuz and attacks on production facilities have also worsened short-term prospects.
Meanwhile, structural challenges still limit growth in the medium term.
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