Indonesia's economy grew by 7.82 percent last year

JAKARTA (JP): State Minister of National Development Planning Ginandjar Kartasasmita said yesterday that Indonesia's economy grew by 7.82 percent last year, down from 8.21 percent in 1995.

He said last year's growth was very satisfying as it was still 0.72 percent higher than the average growth of 7.1 percent targeted for the current Sixth Five-Year Development Plan, which ends on March 31, 1999.

Ginandjar, who is also chairman of the National Development Planning Board, said that although the economy slowed last year, "it was still within the range we wanted".

He said the 7.82 percent growth was measured by gross domestic product growth based on constant 1993 prices.

"The slowing down of economic growth was in line with the cooling down of the economy as a result of the decrease in domestic demand last year," he told reporters after meeting President Soeharto.

The growth of household consumption dropped to 9.2 percent last year compared to 9.73 percent the previous year.

Capital development slowed down to 12.17 percent last year as compared to 13.96 percent the year before.

He said the agriculture sector's contribution to last year's growth decreased to 16.3 percent from 17.16 percent in 1995, while the industrial sector's contribution totaled 25.16 percent, and that of general services 41.01 percent.

Ginandjar said five sectors recorded growth of above 7.82 percent last year, with the highest rate in the electricity, gas and clean water sector with 12.61 percent.

It was followed by the construction sector with 12.37 percent, manufacturing 11.03 percent, finance and company services 10.52 percent, and transportation and telecommunications 8.56 percent.

He said the growth of gross domestic product, combined with population growth control, boosted per capita gross domestic product to US$1,140 last year from $1,039 in 1995.

Asked about Indonesia's economic growth this year, Ginandjar said, "It's still March. It's not easy to predict the growth. But I think it will be between 7.5 and 7.8 percent."

He said that if the Indonesian economy could grow by more than 7.5 percent then it would be an outstanding achievement.

He said reaching an economic growth of more than 8 percent every year was not always good for Indonesia.

"Our aim is not only to reach a high growth. We have to consider other aspects, such as stability and the even distribution of income," he said.

He pointed out that spurring the economic growth much higher could result in an increase of the current account deficit. It could also stand in the way of promoting the even distribution of wealth. (bnt)