Indonesia Economic Outlook

Q1-2024

“The Year of Transition”

Macroeconomic & Political Economy

Research Group
LPEM FEB UI

February 2023
 Macroeconomic Highlights
• GDP growth of Indonesia broke its upward trajectory pattern and decresed to 4.94% in Q3-2023
(y.o.y) from 5.17% (y.o.y) in the previous quarter.

• Accounted for the biggest sectoral activity in the Indonesian economy, manufacturing sector
continued its increasing growth trend since Q1-2023.

• Global weakening demand, potential for global monetary rate cut, and rising geopolitical tension are
economic risks that must be navigated smoothly by the current administration in 2024.

• Seasonal effect of election period are expected to boost private consumption andgovernment
spending.

• To finish massive infrastructure projects, investment is also expected to pick up in 2024. However,
investors may take “wait-and-see” approach until the election period is done.

• The potential of Fed rate cut could trigger Rupiah appreciation and might ease the imported
inflationary pressure.
2
Indonesia’s Economic Conditions
In the Need of New Source of Growth
Growth of GDP and the Main Industries, 2019-2023Q3 Growth of Manufacturing Sector and Its Subsectors, 2019-2023Q3
Weights in
2023Q3
-16 -14 -12 -10 -8 -6 -4 -2 0 2 4 6 8 10 12 14 16 18 20 22 % Weights
in 2023Q3 -20 -15 -10 -5 0 5 10 15 20 25 30 %
Gross Domestic Product
100.0 5.05 100.0 Manufacturing Industry

20.4 Manufacturing Industry 4.84

4.84
34.0 Food & Beverages
13.1 Wholesales and Retail Trade, Repairs 2019 4.41
5.08
2020
Agriculture, Forestry and Fisheries 9.5 Chemicals, Pharmaceutical & Tradit'l Medicine 2019
12.7 1.30 2021 -0.12 2020
2022 2021
9.5 Construction
9.1 Metal Prod, Comp, Elect, Optic & Electricity Equip
3.98
2023 14.59 2022
7.5 Mining & Quarrying
2023
5.63
8.7 Coal; Oil & Gas Refinery
5.76
6.5 Information & Communication
7.89
8.7 Transport Equipment
4.5
Transportation & Storage 11.41
15.32
Financial & Insurance Activity 5.7 Basic Metals
3.9 4.20 12.6

3.1
Accommodation & Food Beverages Activity
10.78
5.3 Textile & Wearing Apparel
-1.50

Source: CEIC
• In Q3-2023, GDP growth of Indonesia broke its upward trajectory pattern and decreased to 4.94% (y.o.y) from 5.17% (y.o.y) in the
previous quarter, registered as the lowest quarterly growth since Q4-2016 (excluding Covid-19 period of 2020 and 2021).
• State budget still showed a surplus in September 2023 due to a contraction in several spending channels, such as personnel and
material spending. As a consequence, public administration sector recorded a massive contraction during Q3-2023.
• El-Nino has caused deterioration in agricultural production, consequently disrupted supply of agricultural products and substantially
decreased the growth of agriculture, forestry, and fisheries sector.
• Deviating from the overall GDP growth figure, manufacturing industry grew by 5.20% (y.o.y) in Q3-2023, increased considerably from 4
4.88% (y.o.y) in the previous quarter
Normalization of Trade and Transport Activity
Growth of Wholesale and Retail Trade Subsector and Its Growth of Transportation and Storage Sector and Its
Subsectors, 2019-2023Q3 Subsectors, 2019-2023Q3
Weight in
-60 -40 -20 0 20 40 60 80 100
Weights in %
-16 -12 -8 -4 0 4 8 12 16 % 2023Q3
2023Q3
Transportation & Storage
100 15.32 2019
2019 2020
Road
100 Wholesale and Retail Trade, Repairs
2020 2021
55.5 9.56
2021 2022
5.08
2022 Storage & Support Activities for Transportation, 2023
Postal & Courier
2023 19.8 20.86

Air
82.1 Non-Motor Vehicles and Motorcycle Trade 11.9 35.57

4.83 Sea
8.2 18.30

Inland Water
3.6 17.68
17.9 Motor Vehicles and Motorcycle Trade and Repairs
Railways
6.25 0.9 29.03

Source: CEIC Source: CEIC

• Wholesale and retail trade sector experienced a lower growth of 5.08% (y.o.y) in Q3-2023 from 5.26% (y.o.y) in Q2-2023.
• The slowdown in the trade of motor vehicle caused by high-base effect of automotive sales as the pent-up demand from Covid-19
materialized in 2022. As a consequence, the automotive sales dropped by 11.95% (y.o.y) in Q3-2023, recording the first negative quarterly
sales growth since the pandemic era.
• With growth rate of 14.74% (y.o.y), transportation and storage sector managed to record double-digit growth for seven consecutive
quarters.
• Despite decelerating, transportation and storage sector maintained its status as the sector with the fastest growth among all sectors in
Q3-2023.
5
Contraction of Government Expenditure
Growth of Household Consumption and its Components, Growth Rate of Investment and its Main Components,
2019-203Q3 2019-2023Q3

Source: CEIC
• Looking at expenditure components, the dip in the economic growth was attributed to a softer household consumption and contraction on
government consumption and exports.
• Government consumption contracted by 3.76% (y.o.y) in Q3-2023 after experiencing a high growth of 10.62% (y.o.y) in the previous quarter. This is
due to lower personnel spending, capital spending, and social assistance disbursement in Q3-2023.
• Household consumption that makes up more than half of Indonesian GDP posted a 5.06% (y.o.y) growth in Q3-2023, slower compared to 5.23%
(y.o.y) growth in the second quarter 2023, due to passing of Ramadan, Eid Al-Fitr, and school holiday season.
• Investment expanded by 5.77% (y.o.y) in Q3-2023, supported by building and structure components. Expedited infrastructure investment as
President Joko Widodo will end his second term soon attributed to the increasing growth.
6
Favourable Credit Performance
Shares of GDP Components, 2017Q1-2022Q3 (%) Credit Growth by Purposes, 2017Q1-2022Q3 (y.o.y, %)

Source: CEIC
Source: CEIC
• Total credit has fully recovered to the pre-pandemic levels. Total credit growth has accelerated to 10.78% (y.o.y) in Q3-2022,
higher than 9.6% (y.o.y) in the previous quarter. The pleasing figure indicates that economic activities have returned back to its
normal conditions as Covid-19 cases remained restrained.
• Meanwhile, according to the latest data in November 2022, the third-party fund declined further to 9.4% (y.o.y) from as high as
12% (y.o.y) in the preceding month as economic confidence improved and economic activities increased.
• In 2023, the banking sector will face a higher interest rate which potentially impact on the higher cost of funds. Nevertheless, the
impact of the higher rate on the real sector may be limited in the near term as confidence towards the domestic economy is still
high.
7
Favourable Credit Performance Indicates a Strong
Rebound in Economic Activities
Shares of GDP Components, 2018Q1-2023Q3 (%) Credit Growth by Purposes, 2017Q1-2022Q3 (y.o.y, %)

Source: CEIC
Source: CEIC
• Credit growth accelerated to 8.86% (y.o.y) in Q3-2023 from 8.40% (y.o.y) in the previous quarter.
• This is driven by a growth increase in investment and working capital components.
• On the other hand, consumption credit growth decline slightly from 9.11% (y.o.y) to 9.05% (y.o.y) as the consumption seasonal peak
has ended.
• The increase in working capital and investment credit might be driven by the acceleration of government projects as it is approaching
the end of current administrative period. 8
Bigger Role of Food Inflation

Inflation Rate (%, y.o.y) Inflation Rate (%, m.t.m)

Source: CEIC Source: CEIC

• In January 2024, headline inflation eased to 2.57% (y.o.y), lower compared to 2.61% (y.o.y) at the end of 2023 and continuing its
downward trend since November 2023.
• As Indonesia renewed its inflation calculation in 2024 using new CPI series which rely on 2022 Cost of Living Survey, the
composition of food commodities increased substantially to 38.0% (previously 33.7%).
• Consequently, controlling food inflation becomes more vital to keep domestic inflation in check and within BI’s target range.
9
Investment Are Still Concentrated
FDI and Domestic Investment (Nominal) FDI Realization by Sectors (Nominal)
IDR Trillion IDR Trillion
400 366 220
200 194
350
180
300 160
250 140
120
184 120
200
100
150 181 80
60 50
100
40 24
50 20
0 0
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4

Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
2016 2017 2018 2019 2020 2021 2022 2023 2016 2017 2018 2019 2020 2021 2022 2023

Foreign Domestic Total Total Primary Secondary Tertiary

Source: CEIC Source: CEIC

• The Investment Coordinating Board (BKPM) reported that the total direct investment realization reached IDR365.8 trillion in Q4-
2023. In comparison to Q3-2023, investment realization in Q4-2023 is 2.27% lower.
• Investment realization is still dominated by downstreaming-policy-related industries. With the combined realization of FDI and
DDI at IDR56.77 trillion in Q4-2023, basic metal industry became the largest contributor of investment realization in Indonesia.
• Based on the investment location, realization of investment is still heavily concentrated in Java.
• The biggest FDI source to Indonesia came from Singapore with total realization of USD3.21 billion followed by China (USD1.85
billion), Malaysia (USD1.65 billion), Japan (USD1.38 billion) and Hong Kong (USD1.29 billion). This could be a worrying sign10
down
the road as Indonesia is heavily relying on its Asian peers in direct investment flow.
Maintained Growth Amidst Turmoil
Monthly Trade Balance (Nominal) Exchange Rate and Accumulated Short-Term Capital
Inflow
IDR Trillion
270 16,500
220
16,000
170
120 15,500

70 15,000
20
14,500
-30
-80 14,000
-130
13,500
-180
-230 13,000

22

23

24
2

3
2

3
2

3
2

3
22

23
2

2
-2

-2
-2

-2
l-2

l-2
n-

n-

n-
-

-
p-

p-
ay

ay
ov

ov
ar

ar
Ju

Ju
Ja

Ja

Ja
Se

Se
M

M
M

M
N

N
Total Portfolio (LHS) Bonds Stocks IDR/USD (RHS)

Source: CEIC Source: CEIC

• Cumulatively, Indonesia recorded a trade surplus of 36.93 billion in 2023 and prolonged trade surpluses for 44 consecutive
months since May 2020.
• Global weakening demand, moderation of commodity prices, and rising geopolitical tension throughout 2023 has caused
considerable decline both in exports and imports figure, although on a different magnitude.
• During the past year, Indonesia’s exports dropped by 11.36% (y.o.y) while imports shrank by 6.55% (y.o.y) compared to 2022.
• On year-to-date basis, Indonesia attracted net capital inflow of around USD4.71 billion throughout 2023 and significantly
improved compared to net outflow of USD4.64 billion in 2022.
11
Composition of Exports and Imports Remains
Indonesia Export Profile (October-November 2023) Indonesia Import Profile (October-November 2023)

Source: CEIC Source: CEIC

• Indonesia's exports dropped by 8.38% (y.o.y) in Q4-2023, moderating from a contraction of 18.66% (y.o.y) in the previous quarter
and prolonged the high-base effect of soaring commodity prices in 2022.
• The increase in non-oil and gas exports was dominated by commodity goods, accounting for 62.9% of the increase. These
commodity goods included mineral resources (38.8%), base metals (13.3%), vegetable and animal fats (8.8%), pearls, diamonds,
and precious metals (2%).
• Imports of oil products shrank by 12.71% (y.o.y) and gas by 24.81% (y.o.y) due to price freefall in comparison to 2022. In addition,
12
China as Indonesia’s main trading partner is in an economic slowdown.
Assessing A Decade of
Jokowinomics
 Economic Growth and Productivity (1)
GDP Growth (%) Labor Productivity**
7

5.64 5.80
6
5.03 5.18
5 4.57

-1

-2

-3
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014)

Jokowi I (2014-2019) Jokowi II (2019-2023)*

Source: CEIC Source: CEIC

* Excluding Covid-19 period (2020-2021) * *Indexed to the start of the administrative period (Year 0 is indexed to 100)
• While Indonesian economy grew faster compared to President Megawati’s time in the office, GDP grew relatively lower compared to President
SBY’s administration in both terms. Average GDP growth during President Jokowi’s first term is around 5.03% (y.o.y) and 5.18% (y.o.y) in its
second term (excluding Covid-19 period).
• It is worth to note that SBY’s presidency coincided with the period of commodity boom, which have spurred economic growth as Indonesia is
main commodities exporter.
• Since the beginning of administration term, there has been higher labour productivity improvement during President Megawati’s and
President SBY’s term. First-term of President Jokowi administration marked the slowest labour productivity increase compared to the other
four presidency term since 2000. 14
 Economic Growth and Productivity (2)
Share of Manufacturing Sector (% GDP) Manufacturing Value-Added (% of Production)
30
27.93 50

26.05
25
22.42 22.02
21.15 45
43.94
20
41.64

15 40 39.12

10

35

0 30
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014) Megawati (2000-2004) SBY (2004-2014) Jokowi (2014-2020)**
Jokowi I (2014-2019) Jokowi II (2019-2023)*

Source: CEIC Source: OECD

* Excluding Covid-19 period (2020-2021) * *The latest data available is in 2020

• Indonesia has been consistently showing the sign of premature deindustrialization. Throughout President Megawati’s era to President Jokowi’s,
manufacturing sector in Indonesia has been consistently shrinking and grew below national GDP growth rate.
• Consequently, second-term President Jokowi’s administration marked the lowest average of manufacturing share to GDP.
• OECD’s data on manufacturing value-added as a share of production also show a downward trend for Indonesia in the last two decades.
• Since President Jokowi took office in 2014, the average manufacturing value-added is around 39.12% until 2020 (due to limited availability of
the data), considerably lower than the average during President Megawati’s (43.94%) and President SBY’s (41.64%).
15
 Global Integration (1)
Backward GVC Participation Forward GVC Participation
30
30

26.37
25 25
22.00
20.66
20 20

15.34
15 13.75 15

11.90

10 10

5
5

0
0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Megawati (2000-2004) SBY (2004-2014) Jokowi (2014-2020)**

Megawati (2000-2004) SBY (2004-2014) Jokowi (2014-2020)**

Source: OECD Source: OECD

* *The latest data available is in 2020 * *The latest data available is in 2020

• Higher GVC participation signals the industrialization of a country is on the right path.
• Yet, both Indonesia’s forward and backward GVC participation is lower during President Jokowi’s era compared to President SBY’s era.
• Lower GVC participation provides further indications that industrialization process is worsening during President Jokowi’s era and domestic
products are relatively more isolated from international trade.

16
 Global Integration (2)
Trade Openness (% of GDP) by Administration Trade Openness (% GDP) by Country

Source: World Bank Source: World Bank

• Trade openness during President Jokowi’s administration suggested similar pattern with GVC participation.
• Overall, trade openness during President Jokowi second five-year term with an average of 39.05% was lower compared to his first five-year
term with an average of 41.25% as well as three other administration before his presidential term: President Megawati (2001 – 2004) at 60.56%,
President SBY I (2004 – 2009) at 56.55%, and President SBY II (2009 – 2014) at 48.12%.
• Compared to ASEAN peer countries, during President Jokowi’s administration, Indonesia’s trade openness is below Singapore, Malaysia,
Thailand, Vietnam, and The Philippines. 17
 Poverty and Inequality (1)
Percentage of Poor People Gini Coefficient**
20 0.42
17.97
0.404
15.97
0.40
0.393
15 0.386

12.08 0.38

10.39
10 9.45
0.36 0.354

0.34

0.32

0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
0.30
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014)
Jokowi I (2014-2019) Jokowi II (2019-2023)* SBY I (2004-2009) SBY II (2009-2014) Jokowi I (2014-2019) Jokowi II (2019-2023)

Source: CEIC Source: CEIC

* Excluding Covid-19 period (2020-2021) * *Gini Coefficient data available since 2005
• On poverty aspect, President Jokowi’s administration has reached single-digit poverty rate, the first in Reformation era. In 2018, percentage of
poor people in Indonesia reached 9.82% and continued to decrease until Covid-19 hit the economy.
• Regardless of Covid-19, both President Jokowi’s administration has managed to continue the consistent trend of poverty eradication in
Indonesia since President Megawati’s era.
• Gini coefficient in Indonesia worsened rather substantially during the second term of President SBY’s administration, on average jumped to
0.404 from 0.354 in his first administration term.
• This has been improved to 0.393 in President Jokowi’s first term and even further to 0.386 in the second term of President Jokowi’s
administration. 18
 Poverty and Inequality (2)
Share of GDRP to National GDP Growth Incidence Curve
70 10%
62.4
9%

Average Expenditure per-capita Growth/year

61.1 61.0 60.6
59.9
60
8%

50 7%

6%
40
5%
30
24.3
4%
22.8 23.3 23.4
22.5

20 3%

2%
9.8 9.6
9.0
10 8.7
7.9
6.9 7.5
4.9 5.4
6.0
1%
3.4 3.2 3.0 3.2 2.9
2.1 2.7 2.4 2.4 2.6

0 0%
Java Sumatera Kalimantan Sulawesi Bali and Nusa Papua and
-1%
Tenggara Maluku 0 20 40 60 80 100

Megawati (2004) SBY I (2009) SBY II (2014) Jokowi I (2019) Jokowi II (2022) Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014)
Jokowi I (2014-2019) Jokowi II (2019-2022)
Source: CEIC Source: Dartanto & Can (2023)

• An inverted U-shape of GIC in the first-term of President Jokowi’s administration suggests that economic growth is more inclusive and equally
distributed as the middle-class population enjoy a higher welfare improvement in comparison to the poorest and richest. Thus, Gini coefficient
could reach 0.38 in 2019.
• On the other hand, U-shaped GIC during President Jokowi’s second term indicates welfare improvement occurred for the poorest 20% and
richest 10% of population. Moreover, middle-class population with income percentile of 60%-80% experienced a negative welfare growth.
• From regional distribution, there is not much of a progress during President Jokowi’s era. Share of economic activity in Java and Sumatera
(western part of Indonesia) has not been improved much in 2022 compared to 2004.
• The concentration of economic activity even reached its peak at the end of President Jokowi’s first term, with Java and Sumatera accounted for
85% of economic activity in Indonesia.
19
 Fiscal
Fiscal Balance (% of GDP) Tax Ratio (% of GDP)
15
0
14

13
-1
-0.81 12 11.56
11.04
-1.38 11 10.40 10.20 10.30
-2 -1.58
10
-2.00
-2.32 9
-3
8

7
-4 6

-5 4

-6 2

0
-7
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014) Megawati (2000-2004) SBY I (2004-2009) SBY II (2009-2014)

Jokowi I (2014-2019) Jokowi II (2019-2023)* Jokowi I (2014-2019) Jokowi II (2019-2023)*

Source: CEIC Source: CEIC
* Excluding Covid-19 period (2020-2021)

• In 2014, President Jokowi started his administration not long after the end of commodity boom and shortly after President Jokowi won 2019
election the economy were hit severely by the Covid-19 pandemic.
• Although Indonesia’s tax revenue was rather stagnant during the first term of President Jokowi’s administration, it gradually increased in
President Jokowi’s second term, albeit slowly, after a massive decline due to Covid-19.
• Despite the low revenue, fiscal discipline has been maintained throughout two terms of President Jokowi’s administration. However, the deficit
is understandably widened as the tax revenue is lower compared to President SBY’s time.
• Various effort to reform fiscal posture and expand fiscal capacity has been undertaken during President Jokowi’s era especially during Covid-
19, including fuel subsidy reform, the passing of tax reform law, and Omnibus law on job creation and financial sector. 20
 Institution Quality
Corruption Perceptions Index Democracy Index

Source: Transparency International Source: World Bank

• During the first term of Jokowi’s administration, Indonesia’s CPI showed continued improvement until it reached its peak at 40 in 2019. This
was due to strong enforcement of the law against those who bribe and corrupt the political system. However, during President Jokowi’s
second term, the CPI indicated a downward trend and fell to 34 in 2022, the lowest score in eleven years and back to its 2014 level when
President Jokowi started his administration.
• In addition to his 6 ministers and 1 deputy ministers during President Jokowi’s second five-year term being involved with various corruption
cases, policies during his second administration perhaps have made it easier for Indonesia to resume its corrupt practices.
• In terms of democracy, Indonesia is currently categorized as flawed democracy regime by the Economist Intelligence Unit with a Democracy
Index of 6.71 in 2022. 21
 Connectivity
Logistic Performance Index Dwelling Time (Day)

Source: World Bank Source: Pelindo

• When President Jokowi took his presidential oath in 2014, the Logistics Performance Index (LPI) by the World Bank, ranked Indonesia in 53rd
place with a score of 3.08. The latest Indonesian LPI score was reported at 3.0 in 2023 putting Indonesia in 63rd place out of 139 countries.
• Although LPI indicated a worsening score between 2018 and 2023, dwelling time in major ports, such as Belawan, Tanjung Priok, Tanjung
Emas, Tanjut Perak, and Makassar has actually gone down.
• There may be two possibilities for this. First, the development during the five-year period, 2018 – 2023 meant almost nothing to improve
logistics performance. Second, improvement in the logistics performance due to infrastructure development during President Jokowi’s
administration has yet to be realized.
22
 Emission
CO2 Emission (Metric Tons/Capita)* Decline of Forest Area (% y.o.y)

Source: World Bank Source: World Bank

*Index to the beginning of administrative period (Year 0 is indexed to 100)

• CO2 emissions per capita dropped during the first two years of President Jokoowi 2014 – 2019 administration. However, since 2016, CO2
emissions per capita indicated an increasing trend. At the end of his first term administration, CO2 emissions was at 2.25 metric tons per
capita, the highest in twenty years.
• Annual decline rate rate during President Jokowi’s administration, both his first and second term, were relatively higher compared to other
administration.
• The average decline of forest area during President Jokowi’s first term was at 0.72%, the highest among the last five administrations.

23
Economic Growth Estimate
 GDP Growth Forecast

Q4-2023 FY2023 FY2024

5.02-5.06% 5.04% - 5.05% 5.0% - 5.1%
Source: LPEM FEB UI

• We see GDP to grow by 5.04% (y.o.y) in Q4-2023 (estimate range from 5.02% to 5.06%), bounced
back into 5%-growth teritorry propelled by end-of-year holiday season; making the estimation for
FY2023 at 5.05% (estimate range from 5.04% to 5.05%).
• Entering 2024, higher global risks through commodity prices, rising logistic costs, and weakening
global demand and trading partner’s economic growth could pose some growth risks to Indonesia.
• On the other hand, Indonesian economy could be lifted through consumption and spending related
to the general election. BI is also expected to have some room for cut rate, potentially boosting
economic activity further.
• Thus, we maintain our previous view that Indonesian economy to grow by 5.0% (y.o.y) in 2024.
25