CORE: Indonesia's Economy Improved In The Third Quarter Due To The Easing Of The PSBB

Piter Abdullah, research director of the Indonesian Center of Reform on Economic (CORE) economic studies institute. (Mery Handayani / VOI)

JAKARTA - Research director of the Indonesian Center of Reform on Economic (CORE) research institute Piter Abdullah predicts that the Indonesian economy in the third quarter will be better than in the second quarter although it is still in the negative zone, which is contracting 3 percent.

"Economic growth in the third quarter, I estimate will return to minus 3 percent. Still minus but better than in the second quarter," he said, quoted from Antara, Tuesday, November 3.

Piter explained that the improvement in economic growth in the third quarter was driven by the easing of the Large-Scale Social Restrictions (PSBB) policy and the realization of social assistance from the government which was quite maximal.

According to him, the easing of the PSBB and various social assistance was able to help to curb the decline in public consumption that had occurred in the second quarter.

"Even though the growth is still negative, consumption is slightly better than in the second quarter," he said.

However, he emphasized that the improvement in the third quarter cannot be used as a basis for recovery in the fourth quarter because economic growth is fully influenced by the development of the COVID-19 case.

Piter said that even though the growth in the third quarter improved, if the COVID-19 case was getting higher and the PSBB policy had to be established, the economy would decline again.

"Even though the third quarter improves, if the pandemic worsens and forces the PSBB to tighten in the fourth quarter, economic growth will decline again," he said.