Knowing What GDP Is And Its Benefits For A Country?

Illustration of GDP (Freepic)

YOGYAKARTA - Indonesia's Gross Domestic Product (GDP) is the largest among ASEAN countries, based on data from the International Monetary Fund (IMF). The IMF report shows that Indonesia ranks first in Southeast Asia with a value of 1.32 trillion US dollars in 2022. What is GDP and its calculation benefits?

Indonesia's GDP is perched at the top of beating Thailand, which is in second place with a value of 536.16 billion US dollars, only half of Indonesia's GDP. Meanwhile, third place is occupied by Singapore and the fourth position is followed by Malaysia.

The amount of GDP obtained by Indonesia in 2022 is an achievement that should be proud of. So what is GDP and how important is it for the state?

Gross domestic product (GDP) is one indicator to measure the economic condition of a country, especially in a macro economy. Reporting from the Central Statistics Agency (BPS), GDP is the amount of added value generated by all business units in a country; or is the value of goods and final services produced by all economic units.

So it can be interpreted simply that GDP is the total value of production and services produced by all people or companies in one country, including added value in a certain period of time, which is generally one year. From GDP, the economy of a country can be seen or illustrated from the productivity level of its population.

GDP is the basis for calculating the economic growth of a country. When GDP experiences an increase, a country is experiencing economic growth, as well as in the opposite condition. However, high GDP does not mean that all residents have a high economic level.

The following are a number of benefits from calculating a country's GDP:

Measuring the rate of national economic growth

Comparison of economic progress between countries

Government policy considerations

Knowing the economic structure of a country

Knowing the indicators of the quality of life of a country's people

That is the review of what GDP is and its benefits for a country. Indonesia's GDP is expected to continue to increase in 2023. The magnitude of GDP is driven by the level of public consumption and investment achievement.

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