Indonesia: Indonesian economy grows at fastest pace since 1996
February 6, 2012
In the fourth quarter, GDP grew 6.5% over the same quarter the year before, maintaining the pace of expansion observed in the third quarter and matching market expectations. The continued resilience of domestic demand, in particular, an acceleration in fixed investment, boosted economic growth in the final quarter of 2011. In the full year 2011, the Indonesian economy grew 6.5%, up from the 6.1% rise recorded in 2010, and, in fact, the fastest pace since 1996. Private consumption increased 4.9% year-on-year (Q3: +4.8% yoy), while government consumption added 2.8%, mirroring the increase recorded in the third quarter. Fixed investment accelerated from a 7.1% rise in the third quarter to an 11.5% expansion in the fourth. On the external side, exports grew 7.9% in the fourth quarter, which was slower than the 18.1% pace recorded in the third quarter, while imports added 10.1% (Q3: +14.0% yoy). As exports lost steam, the external sector's net contribution to overall growth fell from 3.2 percentage points in the third quarter to 0.1 percentage points in the fourth. The Central Bank expects the economy to grow between 6.3% and 6.7% this year and between 6.4% and 6.8% in 2013.