Indonesian Economy 2020 Minus 2.07 Percent, Airlangga: Signals Of Improvement Are Seen

Coordinating Minister for Economic Affairs, Airlangga Hartarto. (Photo: Doc. Setkab)

JAKARTA - Coordinating Minister for Economic Affairs Airlangga Hartarto said Indonesia's economic growth in 2020 shows a positive signal towards recovery, even though it is still in the negative zone. According to him, this positive signal occurred because of government intervention.

"I would like to convey that we see that on a year-on-year basis (yoy) the Indonesian economy will contract by minus 2.07 percent in 2020. We see that positive signals of economic recovery have been seen in the fourth quarter. government intervention, "he said, in a video conference in Jakarta, Friday, February 5.

The Indonesian economy in the fourth quarter of 2020 was minus 2.19 percent. Thus the Indonesian economy is in a recession phase. As for quarterly, the economy grew by minus 0.42 percent compared to the third quarter of 2020 which amounted to 3.49 percent.

Airlangga said that the intervention carried out by the government in the context of handling COVID-19 and national economic recovery had succeeded in increasing government consumption which reached 1.76 percent year on year or annually.

The realization of the COVID-19 handling and economic recovery program reached IDR 579.8 trillion, equivalent to 94.6 percent of the 2020 state budget (APBN).

"This increases public confidence in consumption so that household consumption contracted by minus 3.61 year on year and grew positively by 0.49 percent on a quarterly basis compared to the previous quarter," he said.

As is known, in the second quarter of 2020 Indonesia's economy contracted deeply, namely 5.32 percent. Then, in the third quarter of 2020 the economy showed improvement, the contraction decreased to 3.49 percent and in the fourth quarter of 2020 minus 2.19 percent on an annual basis.

Meanwhile, Indonesia's economic growth contracted by 2.07 percent throughout 2020. This was due to negative growth in the last three consecutive quarters that caused Indonesia to still sink into the brink of recession.

Previously, the Head of BPS Suhariyanto revealed that growth in the fourth quarter was still experiencing contraction of 2.19 percent, but when compared to the previous quarter, this growth showed improvement.

"There are improvements although not as expected, therefore we need to evaluate what needs to be strengthened," said Suhariyanto, Friday, February 5.