JAKARTA. The Minister of Finance declares the increment of Indonesia’s economic growth from January to August 2021 has reached 3.1% year-on-year (yoy). Overall, the Minister of Finance projects the growth rate to reach 3.7%-4.5%.

Sri Mulyani Indrawati, Minister of Finance of Indonesia, during the September 2021 State Budget Performance and Facts press conference today (23/9), also forecasts a decline in economic growth in Q3 2021 of 4%-5%. This is lower than the rate reported in Q2 2021 of positive 7.07% as the economic activities accelerated after the relaxed Community Activities Restriction Enforcement (PPKM) that had started in July. Therefore, the consumption recorded in Q3 2021 depletes from Q2 2021 due to the Eid that had passed in Q2 and the once-decreasing COVID-19 cases.

Sri Mulyani also reasserts that the grand theme of 2021 is economic recovery. However, the aftereffect of COVID-19 still needs to be reviewed as it would affect economic growth in general this year.

The risks of post-COVID-19 include the current condition of the pandemic that is yet to end. Then, the direction of monetary policy of the United States. The economic recovery in the US drives the central bank of the US, the Federal Reserve, to adjust its fiscal policy. Additionally, there is also the situation in China, in which the default risks faced by Evergrande had induced a new dynamic in the said country. This situation would subsequently impact Indonesia’s situation as China is Indonesia’s primary business partner. (AM/ZH)