Indonesia Economy Likely to Grow Up to 5.12% in 2022: BRIN

TheIndonesia.id - Indonesia’s economy will grow in the range of 4.7–5.12 percent in 2022, a researcher from the Economic Research Center of the National Research and Innovation Agency (BRIN), Agus Eko Nugroho, forecast here on Thursday, December 23, 2021.

"We are optimistic that our economy will improve in 2022," he remarked at a virtual media briefing on 'Indonesia’s Economic Outlook in 2022'. He said his forecast was based on Indonesia’s economic growth in 2021.

In the first, second, and third quarters, economic growth was recorded at -0.74 percent, 7.1 percent, and 3.5 percent, respectively, he noted. It is estimated to reach 3.54 percent in the fourth quarter, he said. Thus, the overall growth of Indonesia’s economy in 2021 has been pegged at 3.3 percent, he pointed out.

Furthermore, changes in inventory management will strengthen the economy in 2022, Nugroho predicted. "The increase in public aggregate demand will be anticipated by entrepreneurs and real sector players with various changes in inventory, thus the increase may have a low impact on inflation," he said as quoted by Antara news agency.

Changes in inventory became an important factor in gross capital formation in the first through the third quarters of 2021, he noted. This was indicated by the increase in machinery and equipment provision to support investment in the manufacturing sector, thus it is expected that economic growth in 2022 will remain strong, the researcher said.

Spending on food, beverage, restaurant, transportation, communication, health, and education sectors will contribute to economic growth in 2022, Nugroho added. Overall, all sectors have shown a positive economic performance since the second quarter of 2021, he said. The positive growth is expected to continue in 2022, he added.

The researcher also projected that inflation would remain at 1.69–2.27 percent in 2022. Meanwhile, the rupiah exchange rate will remain relatively stable and under relatively low depreciation pressure at Rp14,301–Rp14,625 per US dollar, he forecast.