The 2024 Election Is Expected To Boost Indonesia's Economic Growth

Secretary of the Coordinating Ministry for Economic Affairs Suswijono Moegiarso. (Photo: Doc. Coordinating Ministry for the Economy)

JAKARTA - The 2024 general election (Pemilu) is projected to contribute to Indonesia's economic growth.

Secretary of the Coordinating Ministry for Economic Affairs Suswijono Moegiarso said the election would contribute to economic growth of up to 0.25 percent.

"People's consumption will definitely be pushed to increase, so we hope that there will be additional GDPs for both 2023 and 2024. Maybe between 0.2 percent to 0.25 percent we can push. This means that election activities have a positive impact on our GDP growth," explained Susiwijono.

Susiwijono conveyed that this contribution would also be reflected in the Consumption of Non-Professional Institutions that serve the Household (LNPRT) which is one of the founders of GDP.

"When it comes to politics, it must be consumed by Non- Profit Institutions that serve households (LNPRT). Now, we project that this LNPRT in 2023 may increase between 4.5 percent to 5 percent and in 2024 it should be higher because the period is around 6.5 percent to 7 percent longer," he explained.

In the midst of slowing global economic conditions, climate change, and declining export commodity prices, the Indonesian economy was maintained and grew positively by 4.94 percent in the 3-2023 quarter.

Household and Investment Consumption (PMTB) is the main contributor to economic growth, where Household Consumption grew at 5.1 percent and Investment (PMTB) grew by 5.8 percent in the 3-2023 quarter.

"With growth at 4.9 percent (yoy) in the third quarter but (ctc) 5.05 percent, we still believe the government in 2023 full year can still grow above 5 percent," said Suswijono.

In encouraging economic resilience and revival, the Government has provided various economic policy strategies.

In terms of household consumption, to maintain people's purchasing power and control inflation, the government continues social assistance policies, including additional rice food assistance of 10kg/KPM in December 2023 with a target of 21.3 million KPM and El Nino Direct Cash Assistance (BLT) of Rp. 200,000 per month during November-December 2023 with a target of 18.8 million KPM.

To strengthen MSMEs in the midst of high interest rates, the government has accelerated KUR through weekend banking so that the absorption of KUR distribution is more optimal and can reach the target of IDR 297 trillion.

"With these two additional assistance to the community, we hope to maintain people's purchasing power and also control inflation, especially later we are in the context of household consumption components that we will protect," said Susiwijono.

Meanwhile, in terms of investment (PMTB), the building sector is the largest PMTB component, which is 74 percent, one of which is from residential buildings with a share of 19.9 percent.

For this reason, the Government touched on the side of the Housing sector with the Government-Borrowed Value Added Tax (PPN DTP) incentive policy.

Susiwjono also said that the Government has implemented several policies to encourage an increase in exports, including the establishment of a National Export Improvement Task Force, opening up opportunities for new markets such as non-traditional markets, as well as strengthening trade cooperation.