Publication: Indonesia Economic Quarterly, March 2010: Building Momentum
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Date
2010-03
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2010-03
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The Indonesian Economic Quarterly reports on and synthesizes the past three months’ key developments in Indonesia’s economy. It places them in a longer-term and global context, and assesses the implications of these developments and other changes in policy for the outlook for Indonesia’s economic and social welfare. Its coverage ranges from the macroeconomy to financial markets to indicators of human welfare and development. It is intended for a wide audience, including policy makers, business leaders, financial market participants, and the community of analysts and professionals engaged in Indonesia’s evolving economy.
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“World Bank. 2010. Indonesia Economic Quarterly, March 2010: Building Momentum. © World Bank. http://hdl.handle.net/10986/30836 License: CC BY 3.0 IGO.”
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Publication Indonesia Economic Quarterly, September 2010(World Bank, Washington, DC, 2010-09)The Indonesian economic quarterly reports on and synthesizes the past three months' key developments in Indonesia's economy. It places them in a longer-term and global context, and assesses the implications of these developments and other changes in policy for the outlook for Indonesia's economic and social welfare. Its coverage ranges from the macro-economy to financial markets to indicators of human welfare and development. It is intended for a wide audience, including policy makers, business leaders, financial market participants, and the community of analysts and professionals engaged in Indonesia's evolving economy. Indonesia's economy continues to record robust growth, in contrast with the volatility and uncertainty characterizing major economies globally. The robustness of growth has allowed the policy focus to shift from near-term uncertainty towards achieving the investments and reform required to achieve sustained and strong growth over the longer-term. Meeting the Government's target of over 7 percent growth by 2014 requires strong rises in investment, particularly in infrastructure, and in skills and productivity. Quarterly output accelerated in Q2, resulting in year-on-year growth of 6.2 percent, the highest since the onset of the global economic crisis two years earlier. Domestic demand, particularly private consumption, underpins the growth performance and has been associated with rising imports, particularly for investment and intermediate goods. Slow disbursement of government expenditures continue to act as a drag on growth, but less so than in Q1. Indonesia's trading partners also recorded stronger growth than expected, although the overall contribution of net external demand to growth was negative in Q2. Correspondingly, domestic-oriented sectors outperformed externally-oriented sectors.Publication Indonesia Economic Quarterly, March 2013 : Pressures Mounting(Washington, DC, 2013-03)Indonesia's economy continued to grow at a steady pace in the final quarter of 2012, taking full-year GDP growth to 6.2 percent. This was only a modest reduction from the 6.5 percent growth recorded in 2011, a resilient performance considering the weak global environment and unsettled financial market conditions which prevailed for much of the year. Looking ahead, Indonesia should be able to maintain a solid pace of growth, but there is no room for complacency, as a number of pressures are mounting which could move the economy off this trajectory. Global economic uncertainties remain elevated, Indonesia s investment growth has moderated and, as highlighted in the December 2012 IEQ, the quality of domestic policies is increasingly in focus, particularly in the run-up to the 2014 elections. Even if growth of 6.0 to 6.5 percent is maintained, there is a risk that, without more progress on policy reform and implementation, the opportunity could be missed to boost growth at a time when the economy is benefiting from a growing labor force and the agglomeration effects of urbanization. Future appointments to key economic policy roles, following the nomination of the Minister of Finance as the next Governor of Bank Indonesia (BI), will also frame the macroeconomic policy environment going forward. The final quarter of 2012 remained challenging for many of Indonesia s major trading partners; growth in the US and Japan was flat and the Euro Area recession deepened, though growth in China firmed. Moving into 2013, global growth remains subdued but international economic conditions have turned somewhat more supportive for growth in Indonesia. Global industrial production is increasing at a modest pace, and global trade is expanding again, with broad-based increases for developing countries exports. Commodity prices have also generally posted modest gains since December, including those of some of Indonesia s key export products like copper, rubber and palm oil. The improved global economic data, and diminishing fears over the risks of extreme adverse scenarios in the Euro area, US and China, coupled with accommodative monetary policy in most high income economies, have been broadly supportive of financial markets. Global equity markets rallied in the final two months of 2012 and have generally held these gains, with some developed country equity indices at or near record highs in nominal terms. Emerging market sovereign credit spreads have widened so far in 2013 but still remain close to their tightest levels since the global financial crisis.Publication Indonesia Economic Quarterly FY14 : Compilation of the July 2013, October 2013, December 2013 and March 2014 Indonesia Economic Quarterly Reports(Washington, DC, 2014-06)The Indonesia Economic Quarterly (IEQ) has two main aims. First, it reports on the key developments over the past three months in Indonesia's economy, and places these in a longer term and global context. Based on these developments and on policy changes over the period, the IEQ regularly updates the outlook for Indonesia's economy and social welfare. Second, the IEQ provides a more in-depth examination of selected economic and policy issues, and analysis of Indonesia's medium-term development challenges. It is intended for a wide audience, including policymakers, business leaders, financial market participants, and the community of analysts and professionals engaged in Indonesia's evolving economy. Indonesia's fiscal and monetary policy settings will continue to play a key role in facilitating the adjustments now taking place and in minimizing associated risks. There are, however, trade-offs between the objectives of restraining inflation, supporting growth and adjusting the current account deficit to the tighter financing environment. Monetary policy faces the challenge of calibrating interest and exchange rates so as to guard against rising inflationary pressures as cost pressures rise (such as from the pass-through of the weaker currency or wage increases) while facilitating improvements in the external balances, and without unduly crimping economic growth and weakening public and private sector balance sheets. With the 2014 budget under discussion with Parliament, fiscal policy faces the challenge of slower revenue growth, and higher energy subsidy and nominal debt-financing costs, raising the importance of lifting further the quality of spending and of revenue mobilization. In response to the intensification of financial market pressures, and in conjunction with the monetary policy and currency market measures mentioned above, on August 23 the Government announced a policy package containing measures intended to improve the current account, safeguard purchasing power and facilitate growth, contain inflationary pressure, and maintain investment flows. Some of the reform measures involved retracting interventionist policies on trade and proposals for improving certainty in the business environment.Publication Indonesia Economic Quarterly, March 2011(Washington, DC, 2011-03)The Indonesia economic quarterly reports on and synthesizes the past three months' key developments in Indonesia's economy. It places them in a longer-term and global context, and assesses the implications of these developments and other changes in policy for the outlook for Indonesia's economic and social welfare. Its coverage ranges from the macro economy to financial markets to indicators of human welfare and development. It is intended for a wide audience, including policy makers, business leaders, financial market participants, and the community of analysts and professionals engaged in Indonesia's evolving economy. Economic developments over the past quarter bear some strong similarities with the situation seen in the first half of 2008. Most notably, rises in domestic and international commodity prices have again brought with them a variety of risks, both positive and negative, at the macroeconomic and household level. While oil prices increased sharply with political developments in the Middle East and North Africa, strong price rises have been seen across global commodities. Non-energy commodities, including food, were up 30 percent in the six months to February 2011, similar to the increases seen in the first half of 2008. The experiences of other countries through the 2008 food price crisis suggest a range of potential policies which can provide well-targeted protection for vulnerable households and maintain and create incentives for producers to help limit future price volatility.Publication Indonesia Economic Quarterly FY13(Washington, DC, 2013-05)The Indonesia economic quarterly reports on and synthesizes the past three months key developments in Indonesia s economy. It places them in a longer-term and global context, and assesses the implications of these developments and other changes in policy for the outlook for Indonesia s economic and social welfare. Its coverage ranges from the macroeconomy to financial markets to indicators of human welfare and development. It is intended for a wide audience, including policy makers, business leaders, financial market participants, and the community of analysts and professionals engaged in Indonesia s evolving economy. The near-term global economic outlook is fragile and emerging economies, including Indonesia, again face the risk of a potential crisis that is not of their making. The growth outlook for Indonesia s major trading partners (MTP), at 3.3 percent in 2012, remains relatively weak as increased Euro zone uncertainty adds to the ongoing drags on global growth from budget cutting and deleveraging in developed economies, and capacity constraints in some developing economies. Recent international financial market turbulence looks set to continue in the near-term and, while this baseline scenario remains the most likely outcome, capital flows to emerging economies and sentiment are likely to remain volatile. Further enhancing crisis preparedness is therefore a policy priority for economies such as Indonesia but, at the same time, it is important to push ahead with reforms and investments which can support medium-term growth in what is likely to be a weaker global economic environment.
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