Economist: 5.5 Percent Economic Growth Target Still Realistic

Jakarta (ANTARA) - Fakhrul Fulvian, Chief Economist at Trimegah Sekuritas Indonesia, believes that the 5.5 percent economic growth target for the first quarter of 2026 remains within a realistic range.

According to him, the target conveyed by Finance Minister Purbaya Yudhi Sadewa to global investors is supported by several fundamental factors.

“First, we are talking about the low base effect from the previous period which was relatively sluggish,” Fakhrul told ANTARA in Jakarta on Thursday.

He added that the acceleration of government spending at the beginning of the year is also a major driver. This is reflected in the widening APBN deficit, which provides a direct boost to domestic demand.

“Second, there is significant acceleration in government spending at the beginning of the year, reflected in the widening APBN deficit. This gives a direct boost to domestic demand,” he explained.

In addition, real sector indicators are beginning to show improvement. Third, retail sales and manufacturing PMI indicate a recovery in domestic economic activity.

“This indicates that the domestic economic engine is starting to move again, although external risks must certainly still be guarded against,” Fakhrul continued.

He emphasised that amid an increasingly fragmented global landscape, a combination of strong policy communication and solid domestic foundations is key to maintaining stability and Indonesia’s market attractiveness.

“In a world that is increasingly narrative-driven, perception is indeed important. But ultimately, the market will return to reality. That is where the credibility of policies and the strength of fundamentals will be tested,” he said.

Finance Minister Purbaya Yudhi Sadewa assured global investors of the resilience of Indonesia’s macroeconomic fundamentals and fiscal strategy during meetings in New York and Washington DC, United States (US).

The meetings were attended by several major investors, including HSBC Global Asset Management, Lazard Asset Management, BlackRock, Lord Abbett, and TD Asset Management.

In that context, Indonesia’s economic growth in the first quarter of 2026 is projected to be around 5.5 percent.

Purbaya assessed that if the growth trend continues into the second quarter, it could increase investor confidence to expand their investments in Indonesia.