Indonesia Economic Forecast

Indonesia Economic Outlook

November 16, 2021

The economy grew at a notably softer pace in Q3, despite upbeat exports and higher commodity prices, as a surge in Covid-19 cases in July and August and subsequent harsh lockdowns weighed on the recovery. A marked deceleration in domestic demand growth was behind the reading, with private consumption, public spending and fixed investment all weakening. That said, conditions have improved so far in Q4 amid a relaxation of restrictions, as suggested by a jump in the manufacturing PMI in October. Moreover, authorities recently approved Novavax’s vaccine, which should further support vaccination efforts. Meanwhile, in early November the government placed a cap on prices for coal sold to local cement and fertilizer plants to protect them against surging global prices, although this could weigh on coal production, while it plans to reduce exports of raw materials to attract onshore investment.

Indonesia Economic Growth

Growth is seen gaining considerable steam in 2022, following an uneven recovery this year. A notable strengthening of domestic demand amid reduced containment measures, unleashed pent-up spending and supportive fiscal and monetary policy stances should spearhead the upturn, while foreign demand will likely soften, albeit remain robust. FocusEconomics Consensus Forecast panelists expect GDP to expand 5.3% in 2022, which is up 0.1 percentage points from last month’s forecast. In 2023, GDP is also seen growing 5.3%.

Indonesia Economy Data

2015 2016 2017 2018 2019
Population (million)256258261264267
GDP per capita (USD)3,3683,6073,8853,9464,194
GDP (USD bn)8619321,0151,0421,120
Economic Growth (GDP, annual variation in %)
Consumption (annual variation in %)
Investment (annual variation in %)
Manufacturing (annual variation in %)
Retail Sales (annual variation in %)13.311.
Unemployment Rate6.
Fiscal Balance (% of GDP)-2.6-2.5-2.6-1.7-2.2
Public Debt (% of GDP)
Money (annual variation in %)
Inflation Rate (CPI, annual variation in %, eop)
Inflation Rate (CPI, annual variation in %)
Inflation (WPI, annual variation in %)-  -  -  -  -  
Policy Interest Rate (%)7.504.754.256.005.00
Stock Market (annual variation in %)-12.115.320.0-2.51.7
Exchange Rate (vs USD)13,78813,47313,56814,38013,883
Exchange Rate (vs USD, aop)13,39213,30213,38314,23314,141
Current Account (% of GDP)-2.0-1.8-1.6-2.9-2.7
Current Account Balance (USD bn)-17.5-17.0-16.2-30.6-30.4
Trade Balance (USD billion)7.79.511.8-8.7-3.2
Exports (USD billion)150145169180167
Imports (USD billion)143136157189171
Exports (annual variation in %)-14.6-3.416.36.6-7.0
Imports (annual variation in %)-19.9-4.915.720.2-9.5
International Reserves (USD)106116130121129
External Debt (% of GDP)36.134.334.736.036.1

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Indonesia Facts

Value Change Date
Bond Yield7.10-0.05 %Dec 31
Exchange Rate13,8830.05 %Jan 01

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