Economist Reveals Facts Behind GDP Data, Says Indonesian Economy Remains Solid

Indonesia successfully maintained a positive economic growth trend above 5%, recording 5.29% year-on-year (yoy) growth in the second quarter of 2026, bringing cumulative growth for the first half of 2026 to 5.46% (ctc). BNI Chief Economist Leo Rinaldy assessed this performance as solid, reflected in two key aspects: Indonesia managed to sustain growth while peer countries averaged only 3%.

From the expenditure side, the quarter-on-quarter decline between Q1 and Q2 2026 was attributed to a normalisation effect following the previous year’s economic performance. Meanwhile, government spending grew significantly, reflecting state support for purchasing power. Real investment variables rose nearly 7% yoy, primarily supported by construction investment from both the public and private sectors, such as the physical development of the Merah Putih Village/Subdistrict Cooperatives (KDMP).

In the manufacturing sector, although overall growth slowed, several sub-sectors strengthened, including textiles, footwear, and furniture, driven by export performance. However, challenges remain in improving the quality of economic growth, particularly regarding employment data, where 59.3% of the workforce is still employed in the informal sector. Therefore, the government’s focus and fiscal policy direction are aimed at creating formal employment opportunities.