Jakarta (VNA) – The International Monetary Fund(IMF) has predicted that Indonesia’s GDP growth may contract by 1.5 percent in2020 rather than 0.3 percent as it initially forecasted in June this year dueto impacts of COVID-19 pandemic.
In its October update of the World Economic Outlook that wasreleased on October 13, the IMF noted that the Indonesian economy remainsunstable due to the spreading of the pandemic, which has posed adverse impactson many sectors, including tourism.
All emerging market and developing economy regions areexpected to contract this year, including notably emerging Asia, where largeeconomies, such as India and Indonesia, continue to try to bring the pandemicunder control, said the report.
Indonesia has been struggling to contain the outbreak in thecountry as COVID-19 cases reached 340,622 with more than 12,000 deaths as of October13. The country has been adding around 3,000 to 4,000 cases daily since September19.
Indonesia’s GDP was down 5.32 percent year-on-year in thesecond quarter due to falling household spending and investment, witheconomists and government officials projecting another contraction in the thirdquarter, which would mark a recession.
The global economy, meanwhile, is expected to shrink by 4.4percent this year, a less severe contraction compared to the IMF’s previousestimate of 4.9 percent, due to better-than-expected second-quarter GDP data incountries where activity began to improve after lockdowns and signs of rapidrecovery in the third quarter.
The pandemic will reverse the progress made since the 1990sin reducing global poverty and will increase inequality, as the IMF expectsnearly 90 million people to fall into poverty this year, according to IMFeconomic counsellor Gita Gopinath.
The IMF expects the global economy to rebound and grow by5.2 percent in 2021, while Indonesia’s economy is expected to expand by 6.1percent.
According to Indonesian Finance Ministry’s Fiscal PolicyAgency director for state budget policy, Ubaidi Socheh Hamidi, the Indonesian government’sefforts to contain the pandemic and extended fiscal support will help boosteconomic growth to 5 percent in 2021./.
In its October update of the World Economic Outlook that wasreleased on October 13, the IMF noted that the Indonesian economy remainsunstable due to the spreading of the pandemic, which has posed adverse impactson many sectors, including tourism.
All emerging market and developing economy regions areexpected to contract this year, including notably emerging Asia, where largeeconomies, such as India and Indonesia, continue to try to bring the pandemicunder control, said the report.
Indonesia has been struggling to contain the outbreak in thecountry as COVID-19 cases reached 340,622 with more than 12,000 deaths as of October13. The country has been adding around 3,000 to 4,000 cases daily since September19.
Indonesia’s GDP was down 5.32 percent year-on-year in thesecond quarter due to falling household spending and investment, witheconomists and government officials projecting another contraction in the thirdquarter, which would mark a recession.
The global economy, meanwhile, is expected to shrink by 4.4percent this year, a less severe contraction compared to the IMF’s previousestimate of 4.9 percent, due to better-than-expected second-quarter GDP data incountries where activity began to improve after lockdowns and signs of rapidrecovery in the third quarter.
The pandemic will reverse the progress made since the 1990sin reducing global poverty and will increase inequality, as the IMF expectsnearly 90 million people to fall into poverty this year, according to IMFeconomic counsellor Gita Gopinath.
The IMF expects the global economy to rebound and grow by5.2 percent in 2021, while Indonesia’s economy is expected to expand by 6.1percent.
According to Indonesian Finance Ministry’s Fiscal PolicyAgency director for state budget policy, Ubaidi Socheh Hamidi, the Indonesian government’sefforts to contain the pandemic and extended fiscal support will help boosteconomic growth to 5 percent in 2021./.
VNA
