Indonesian Government Eyes Faster GDP Growth in 2017

Jakarta, 10 Syawal 1437/15 July 2016 (MINA) – The Indonesian government forecast a faster economic growth next year as the spending of development budget and consumption pick up amid efforts to repatriate a massive of assets, Xinhua rported.

Finance Minister Bambang Brodjonegoro said on Thursday that the government expected the economy to grow 5.3 to 5.9 percent next year, compared with this year’s target of 5.2 percent.

The spending of the development budget was estimated to rise 6.3 to 6.5 percent next year, 5.1 to 5.2 percent for household consumption and 6.4 to 7.3 percent for gross fixed capital formation (PMTB), Brodjonegoro said.

“Exports are expected to improve and they can support the growth,” he told lawmakers in a session at the parliament.

Last month the government and parliament endorsed the tax amnesty law, which has bolstered stock markets amid the hope that it will spur a massive influx of repatriated assets.

That in part can help accelerate President Joko Widodo’s huge infrastructure development program to create more jobs as he expects over 7-percent GDP growth in 2019.

Indonesia said 165 trillion rupiah (some 16.5 billion U.S. dollars) out of 3,147 trillion rupiah (equal to 314,7 billion U.S. dollars) funds owned by Indonesian nationals overseas could be repatriated.

With rebound of the global commodity prices following a gradual hike of oil prices, Indonesia’s exports which, over 60 percent of them are commodities, are expected to rise in coming months.

However, the rest of the country’s exports are manufactured products with most their raw materials imported.

“Imports (are estimated to grow) 1.8 to 3.2 percent (in 2017) … and export 1 to 2.7 percent,” Minister Brodjonegoro said.

The Indonesian central bank has more rooms to apply easing policy as the prospect for the U.S. Fed Reserve’s rate hike plan has weakened after the Brexit, and Indonesia’s inflation is in check. (T/R07/R01)

Mi’raj Islamic News Agency (MINA)