Indonesia's 2001 GDP growth seen at 3.17 percent: Poll

Indonesia's 2001 GDP growth seen at 3.17 percent: Poll

Reuters, Jakarta

Indonesia should record economic growth of 3.17 percent this
year and 4.0 percent in 2002, bolstered by political stability
and improved business conditions, a Reuters poll of 10 research
houses showed.

The government has predicted GDP growth of 4.5-5.5 percent
next year, up from its forecast of 3.5 percent in 2001, but many
analysts doubt next year's target can be achieved.

President Megawati Soekarnoputri's efforts to kick-start
growth are crucial to restoring stability after years of
political chaos and social upheaval in the world's largest Muslim
nation.

So far, she has won strong praise for filling key cabinet
posts with economic professionals and for her first budget,
covering 2002.

But her country is embroiled in bitter ethnic and religious
divisions, complicated by political strife that has seen four
presidents in office over the past four years, as Indonesia moved
towards democracy after decades of autocratic rule.

A major oil and commodities exporter, Indonesia had yet to
recover from the 1997 Asian financial crisis when the global
economy began slowing this year and won't escape the economic
fallout from the Sept. 11 attacks on the United States.

But some analysts saw domestic demand in the world's fourth
most populous country as the key factor.

"Basically, 75 percent of Indonesia's economy is based on
consumption, which much depends on stability, Standard Chartered
economist Fauzi Ichsan said.

"We believe that Indonesia will have better political
stability next year, (better) political certainty."