The Indonesian Economic Growth Slows Slightly in Third Quarter

The Indonesian Economic Growth Slows Slightly in Third Quarter

Indonesia: The Indonesian economy expanded by 5.04% year-on-year in the third quarter, down from 5.12% in the previous quarter, according to official data released on Wednesday. The moderation in growth poses a challenge for the government, which aims to achieve an annual target of 5.2% and gradually raise it to 8% by 2029. The slowdown coincided with anti-government protests and disruptions in key sectors, including mining, where production declined due to weak global demand for coal and reduced copper output following a mudflow incident in Papua. Household consumption, which accounts for more than half of GDP, eased slightly to 4.89%, while investment growth slowed to 5.04% from a four-year high in the previous quarter.

Government spending rose by 5.49% after a brief contraction earlier in the year, and exports increased by 9.91%, driven by stronger shipments of vegetable oil, steel, and automotive products. The government had earlier introduced a 24.44 trillion rupiah (USD 1.5 billion / EUR 1.4 billion) stimulus package and announced an additional nearly USD 3 billion (EUR 2.8 billion) for the fourth quarter to support growth. Chief Economic Minister Airlangga Hartarto said the government would intensify efforts in the final quarter to meet the year-end target, while analysts noted that Bank Indonesia may consider further rate reductions to stimulate the economy.

Source: Reuters