Kadin Optimistic Of Indonesia's Economic Growth To Reach 3.5-5 Percent By The End Of 2021: Because PPKM Relaxed?

Illustration. (Photo: Doc. Antara)

JAKARTA - Deputy Chairperson of Kadin for International Relations Shinta Kamdani estimates that economic growth will reach 3.5 to 5 percent for the whole of 2021, which is triggered by the implementation of PPKM relaxation and the impact of increased consumption at the end of the year.

"The prediction is 3.5-5 percent, yes. I think it makes sense for us to be able to achieve it by the end of the year," he said at the HSBC Summit 2021 online, quoted from Antara on August 25.

For the July-September period or the third quarter of 2021, Shinta predicts economic growth will be in the range of 3.5-4 percent on an annual basis (yoy).

According to him, the impact of social restrictions from the implementation of restrictions on community activities (PPKM) will be felt in the third quarter of 2021.

The projected figure for economic growth in the third quarter of 2021 is much lower than the realization of economic growth in the second quarter of 2021, which is 7.07 percent (yoy).

Therefore, the sustainability of the second quarter of economic recovery will not be optimal in the third quarter of 2021 because the government is forced to implement PPKM to reduce the number of COVID-19 cases.

However, after the government relaxed the PPKM as of August 24, 2021 due to declining COVID-19 cases, Shinta assessed that the impact would begin to be felt on economic activities.

"This speed of relaxation can help in terms of achieving economic growth in the fourth quarter of 2021, so that we can take advantage of consumption at the end of the year," he said.

He admitted that the current economic condition is still filled with uncertainty. The pace of economic activity will depend on the success of the government in handling the COVID-19 pandemic, especially to prevent the third wave of COVID-19 cases from occurring.

In addition, said Shinta, the government must also restore the confidence of the public and the business world. Efforts to control COVID-19 must be optimized and accompanied by the speed of COVID-19 vaccination throughout the country.

"Also with the COVID-19 vaccination, the restoration of public consumption confidence. This will be very helpful from the recovery aspect," he said.