Indonesia growth up in 2016 but Q4 figures disappoint

Agence France-Presse

This is AI generated summarization, which may have errors. For context, always refer to the full article.

Indonesia growth up in 2016 but Q4 figures disappoint

AFP

A weaker-than-expected quarterly performance of 4.94% in the period October to December overshadows the annual data. The growth in the fourth quarter is dragged down by a dip in government spending.

JAKARTA, Indonesia – Indonesia’s efforts to reboot its economy were dealt a blow on Monday, February 6, as official data showed growth ticking up in 2016 but undershooting expectations for the final quarter.  

President Joko Widodo came to power in 2014 on a pledge to boost economic expansion to 7% but his government has struggled to lift growth rates in Southeast Asia’s largest economy, which is rich in resources but has suffered from a slump in commodity prices.

After several years of subdued economic output, government figures showed a glimmer of acceleration for 2016, with growth of 5.02%, compared to 4.88% a year earlier – the smallest expansion since 2009.

But a weaker-than-expected quarterly performance of 4.94% in the period October to December overshadowed the annual data. The growth in the fourth quarter was dragged down by a dip in government spending.

The statistics agency said that the top contributors for growth last year were manufacturing and agriculture. 

Authorities unleashed a series of economic stimulus last year to reinvigorate growth, while the central bank cut the key interest rate 6 times.

Now analysts say there is little room for manoeuvre.

“Looser fiscal and monetary policies have helped to support growth over the past year, but further easing is unlikely over the next year,” said Gareth Leather of London-based Capital Economics.

Economists said while growth won’t slow further, it won’t accelerate further either, with Capital Economics maintaining its estimation for Indonesia at a flat rate of 5% for this year and next. – Rappler.com

Add a comment

Sort by

There are no comments yet. Add your comment to start the conversation.

Summarize this article with AI

How does this make you feel?

Loading
Download the Rappler App!