REPUBLIKA.CO.ID, JAKARTA -- Data from the Central Statistical Agency (BPS) shows economic growth in the fourth quarter of 2023 grew by 5.04 percent on an annual basis. That's an increase compared with growth the previous year of 4.94 percent on an annualized basis.

With this development, Indonesia's overall economic growth in 2023 is recorded to grow strongly by 5.05 percent on an annual basis. “Indonesia's economic growth remains strong amid the global economic slowdown,” Central Bank of Indonesia (BI) Communications Department Assistant Governor Erwin Haryono said in a written statement on Tuesday (6/2/2024).

By 2024, BI projects economic growth is forecast to increase in the range of 4.7 to 5.5 peraens supported by mainly domestic demand and continued growth in consumption. It also includes the positive impact of holding elections, as well as increased investment in buildings in line with the continued development of National Strategic Projects (PSN) including the Capital City of Nusantara (IKN).

Meanwhile, export performance is forecast to have not been strong as the impact of a not yet strong global economy and declining commodity prices.

“Bank Indonesia will continue to strengthen the synergy of the Government's fiscal stimulus with Bank Indonesia's macroprudential stimulus to drive economic growth, particularly in terms of domestic demand,” Erwin explained.

Increased economic growth in the fourth quarter of 2023 was supported by almost the entire component of GDP. Household consumption grew by 4.47 percent on an annual basis along with a rise in mobility especially on the National Religious Great Day (HBKN) of Christmas and New Year, stable public purchasing power, and rising consumer confidence.

Consumption of Nonprofit Institutions Serving Households (LNPRT) grew at a high of 18.11 percent on an annual basis driven by increased election preparation activity. Government consumption increased by growing by 2.81 percent driven by spending on goods and employee spending.

Investment grew by 5.02 per cent on an annualised basis mainly sustained by building investment as infrastructure development continued and capital investment activity increased.

Meanwhile, exports grew by 1.64 percent on an annual basis supported by demand from major trading partners, which remained positive amid falling prices for key export commodities, as well as improving exports of services along with an increase in the number of foreign tourists.

Increased economic growth also occurs from the business and spatial side. Field of Business (LU). All LU in the fourth quarter of 2023 showed positive performance with high growth recorded in the mobility-related sectors especially Transportation and warehousing, provision of accommodation and drinking, and retail trade.

LU Processing Industries as a major contributor to growth is also growing both as domestic and global demand is strong. Meanwhile, spatially, economic growth in the fourth quarter of 2023 in most regions of Indonesia was higher compared to the growth of the previous quarter.

The highest economic growth in the fourth quarter of 2023 was recorded in the Sulawesi—Maluku-Papua (Sulampua) region. Then followed also in Borneo, Java, Bali-Nusa Tenggara (Balinusra), and Sumatra.

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