Indonesian economy grew 3.92 percent in 3rd quarter: BPS
Indonesian economy grew 3.92 percent in 3rd quarter: BPS
The Jakarta Post, Jakarta
The economy grew by 3.92 percent during the third quarter over
the same period last year, said the Central Bureau of Statistics
(BPS), adding that slowing consumption growth meant Indonesia
would be unlikely to meet its full year economic growth target of
4 percent.
BPS deputy chairman La Ode Syafiuddin said on Friday that
domestic consumption remained the key driver behind the 3.92
percent third quarter growth in the economy.
"Although growth in private consumption has slowed down a bit,
it has still contributed a lot to the overall economy," he told a
press briefing. "Exports and investment also increased slightly."
Third quarter private consumption, as measured by household
spending, grew more slowly at 4.9 percent against 6.3 percent
during the third quarter last year.
Over the same period, however, exports and investment spending
recovered after both had plunged in the second quarter.
Exports grew by 1.6 after slumping by 7.1 percent in the
previous year, while investment grew by 2.1 percent compared to a
1 percent drop last year.
Despite the promising figures, Syafiuddin warned that the
upward trend was unsustainable.
The BPS growth figures have yet to fully take account of the
Oct. 12 Bali bombing, which will dampen the economic outlook well
into 2003.
The terrorist attack on the holiday island has dealt a severe
blow to Indonesia's tourism sector, which on average contributes
US$5 billion to the economy.
Renewed security concerns also undermine business confidence
in a country where the net capital inflow is already negative.
Legal uncertainties, a corruption prone judiciary, and
turbulent labor relations are among the main investor worries
keeping capital away from the country.
The government has revised down its economic growth target, as
measured by the country's gross domestic product (GDP), to 4
percent from 5 percent previously. GDP measures the annual output
of goods and services produced in a country.
Analysts, however, doubt that the revision is sufficient to
reflect the economic fallout from the Oct. 12 terrorist strike.
"The Bali bombings will certainly take their toll on the
economy. I don't have the precise figures, but it'll be
impossible to achieve the 4 percent target (of growth),"
Syafiuddin said.
Aviliani, an economist at the Institute for Economic and
Finance Development (Indef), was also doubtful about the target.
She said investment and exports needed to grow faster if the 4
percent growth target was to be achieved.
"Even before the Bali attacks, the performance of these two
indicators have been somewhat disappointing. I think the target
is no longer realistic at this stage," she said.