National Economy Continues To Grow, Government Asked To Maintain People's Purchasing Power And Boost Spending

JAKARTA - The Central Statistics Agency (BPS) announced that Indonesia's economic growth in the second quarter of 2022 was 5.44 percent year on year (yoy). This growth is estimated to continue in the third and fourth quarters so that Indonesia can achieve the 5.2 percent growth target in 2022. Institute for Development of Economics and Finance (Indef) economist Nailul Huda, said that the fairly good economic growth in the second quarter was mainly due to by public consumption. In the second quarter, according to him, there were several moments that triggered an increase in public consumption. "If we look at what actually rose quite high, it was public consumption. This rose about 5.51 percent. So the second quarter was greatly helped by public consumption. There is a moment of Ramadan , Eid al-Fitr, as well as the preparation of new teachings. So if we look at the growth in public consumption, it has risen very sharply," he said in Jakarta, Saturday, August 6. According to him, public consumption contributes 50 percent of GDP. This is the main factor for economic growth to reach 5.44 percent in the second quarter. However, Huda predicts that Indonesia's economic growth in the third quarter will not be as impressive as the second quarter. This is because there is no moment to encourage public consumption. "There is no moment for faster growth in the third quarter. So we will see that economic growth will slow down in the third quarter," he said. In the fourth quarter, Huda continued, economic growth could be increased again. With a note, inflation can be suppressed as low as possible. According to him, an increase in domestic commodity prices will trigger inflation because it suppresses people's purchasing power. "Even if inflation is too high, economic growth can be below 5 percent," he explained. , and exports. Of the three factors, public consumption is the most important. Therefore, the government is expected to be able to suppress inflation so that it is not too high so that people's purchasing power is maintained. "How do you do that? Surely you have to maintain inflation in various ways, for example stabilizing food prices, if the government wants to increase the price of pertalite fuel and gas by 3 kilograms, it must have to be done. maintain people's purchasing power with subsidies, for example," he explained. Huda reminded that government consumption must also be increased in the third quarter. Although small, government consumption can also help boost economic growth.