Jakarta, Aug 10 (Antara) - The government must work harder to spur the country's economic activities in order to achieve its economic growth target set for this year at 5.2 percent.
The Central Bureau of Statistics (BPS) has revealed that economic growth in the second quarter of 2017 was recorded at 5.01 percent, which is relatively stagnant as compared to that in the first quarter of 2017.
"The 5.2 percent growth target is difficult to achieve, considering the economic growth in the second quarter,¿ Economist Abra Talattov of the Institute for Development of Economics and Finance (Indef) said in a statement on Monday (Aug 7) based on the BPS data.
Hence, the Indonesian central bank (Bank Indonesia/BI) warned of potential risk that could hinder the prospect of economic growth for the second semester of 2017, especially with domestic demand that is yet to recover.
"This is related to domestic demand that is yet to be strengthened with the continued reconciliation process of corporate and banking," BI's executive director for communication department Agusman said in a statement.
According to BI, the economic growth in the second quarter of 2017 at 5.01 percent (year on year) has reflected a continued process of economic recovery but was still below expectation.
The growth was lower than the 5.18 percent growth during the same period of 2016 and same as the first quarter of 2017.
According to Chief Economic Minister Darmin Nasution, considering the current condition, Indonesia's first-semester economic growth of 5.01 percent is not bad. "Overall, our economic growth is not bad, though it is not as good as expected," he said.
The economic growth of 5.01 percent was achieved even though household consumption, exports and imports slowed down slightly. The investment sector has shown positive performance in the second quarter of 2017, contributing to the economy, he remarked.
Therefore, BI remains optimistic that the national economy will grow by 5.2 percent based on the target in 2017, despite the relatively stagnant growth of 5.01 percent in the second quarter.
"We are still optimistic. Indeed, the growth in the first and second quarters stayed at a range of 5 percent, it could exceed 5.2 percent in the third and fourth quarters," BI Governor Agus Martowardojo said after an official meeting with Minister of Public Works and Housing Basuki Hadimuljono here on Monday.
In order to achieve the economic growth target set in 2017, the government would boost investment in the second semester of the year. The National Development Planning Board (Bappenas) is expecting to witness greater contribution from the investment sector in the second semester of 2017 to spur higher economic growth.
"In terms of expenditure, it is investment that should be encouraged. In the second semester, more government investment would be materialized. Private investment would also begin to improve," Bappenas' Director for Macro Planning and Statistical Analysis Amalia Adininggar Widyasanti stated.
Besides, Bappenas is also peparing a program to drive up the country's current economic growth levels. It is now studying several economic sectors, such as property and commodity, which will help it formulate a program that will boost the economy.
"The commodity and property sectors are related to the other sectors, which can create jobs and raise the purchasing power," Bappenas Head Bambang Brodjonegoro said meanwhile.
Brodjonegoro said that to increase the growth in the second semester, investment realization is expected to become a booster, besides the consumption by the government and the private sector.
The Bappenas chief also explained that to increase foreign and domestic investment, it is not a must for the government to revise the negative investment list (DNI). The present investment potential is adequate, he noted.
"We need to focus more on realizing the investment. Major investments are in infrastructure and tourism. We see that the two sectors are the main attraction for foreign investors. We need to realize it, so that it will have an impact on the economy," he remarked.
He stressed that while attracting investment into the country, the focus must be on two main things; the ease of investment in the country and the business certainty for investors.
"So, whatever the package is, it should answer these two things," he emphasized.
Chief Economic Minister Darmin Nasution added the government will encourage investments in the remaining two quarters by issuing an economic policy package related to ease of doing business, he revealed.
"We are preparing a large package (of economic policies), which will involve all the ministries, non-ministerial government agencies and regional governments by focusing on expediting the realization of investment proposals," he stressed.
In addition, the government will also increase government spending, which grew negatively in the second quarter, to boost the economy, he mentioned.
The lower-than-expected government spending is one of the factors that caused the second-quarter growth to fall short of its target of 5.1 percent, he said.
The Central Statistics Agency (BPS) announced earlier that the economy grew 5.01 percent year-on-year in the second quarter, fueled by investments that grew 5.35 percent, household consumption (4.95 percent), exports (3.36 percent), imports (0.55 percent) and Non-Profit Institutions Serving Households (LNPRT) consumption (8.49 percent).
However, the government spending contracted by 1.93 percent owing to a fall in the personal and goods expenditure. Cumulatively, the economy grew 5.01 percent in the first half of this year.**3***(a014/INE)EDITED BY INE(T.A014/A/BESSR/A. Abdussalam) 11-08-2017 00:02:0 |
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