Economy Grows 5.61 Percent, Boosted by Public Consumption

The Central Statistics Agency (BPS) has announced that Indonesia’s economy grew by 5.61 percent in the first quarter of 2026 on a year-on-year basis, higher than the same period last year at 4.87 percent. BPS Chief Amalia Adininggar Widyasanti stated that Indonesia’s economy remains resilient and records solid growth amid global geopolitical dynamics. “Indonesia’s economy in the first quarter of 2026 grew by 5.61 percent, one of which was driven by maintained public consumption,” said Amalia during a press conference on economic growth at the BPS office in Jakarta on Tuesday (5/5/2026). She explained that household consumption was the highest source of growth at 2.94 percent. Amalia said that the performance of household consumption in the first quarter of 2026 was mainly driven by population mobility during national holidays and Religious Big Days (Nyepi and Eid al-Fitr), various government policies in controlling inflation, as well as government stimuli to encourage consumption such as transport ticket discounts, provision of THR or 14th salary, and setting the BI rate at 4.75 percent as an effort to encourage economic growth. “The number of domestic tourist trips grew by up to 13.14 percent (yoy), followed by an increase in the number of passengers in several modes of transport such as land transport, ASDP, air transport, and sea transport,” Amalia continued. She added that the growth in the number of land transport passengers even reached 20.20 percent. Besides household consumption, another component driving economic growth from the expenditure side is Gross Fixed Capital Formation (PMTB), which grew solidly by 5.96 percent. “This figure was driven by government investment, including construction related to national priorities and private investment,” said Amalia. Meanwhile, government consumption grew impressively to 21.81 percent in line with the increased realisation of employee expenditure through the payment of the 14th salary (THR) as well as an increase in goods and services expenditure, especially through programmes for the community such as the Free Nutritious Meals (MBG). From the business field side, BPS recorded five main sectors that provided significant contributions to the total GDP in the first quarter of 2026, namely manufacturing industry (19.07 percent), trade (13.28 percent), agriculture (12.67 percent), construction (9.81 percent), and mining (8.69 percent).