“Indonesia is experiencing a growth trend in the second quarter of 2022 of 5.4 percent, up from the first quarter of 2022 which was five percent.”

Jakarta (Indonesia Window) – Finance Minister Sri Mulyani Indrawati has said the Indonesian economy in the second quarter of 2022 showed a very impressive performance amid the global crisis and uncertainty, supported by performance in consumption, investment and exports.

"When compared to other countries, Indonesia is experiencing a growth trend in the second quarter of 2022 of 5.4 percent, up from the first quarter of 2022 which was five percent," Sri Mulyani said in an official statement published on the Kemenkeu.go.id, here on Friday.

According to the minister, most countries including Italy, France, Germany, China and the United States are experiencing a slowing trend.

"This illustrates that the risk has begun to be seen in the second quarter’s economic growth in countries, which is quite large and its impact on the world is quite large," she told a press conference here on Thursday (Aug. 11).

Considering the context of real gross domestic product (GDP), the minister said that Indonesia is far above pre-Covid conditions.

Indonesia's economic growth in the second quarter of 2022, which amounted to 5.4 percent, was a boost from the economic recovery, especially from public consumption which increased or grew by 5.5 percent, she noted.

“This is a very high growth. The Covid-19 is under control, people's mobility is increasing, and community activities other than mobility are also starting to consume, especially the upper middle class. During the second quarter, we also celebrated Ramadan and Eid al-Fitr," she said.

On the other hand, the government consumption was still relatively contracted in the second quarter of 2022 in line with the declining spending for handling the pandemic, he said, adding that the government increased its spending in 2021 for vaccination programs, social assistance, wage subsidies, and assistance to micro, small and medium enterprises (MSMEs) quite massively.

"Now that the pandemic is relatively manageable, some of the social assistance are being corrected. However, the government actually continues to increase (budget) to protect the public not from the pandemic, but from the possibility of price increases. Like at that time, we did it for cooking oil," she pointed out.

Meanwhile, investment has also begun to show a recovery, but there has been a slowdown due to the high prices of goods. Investment in the first quarter grew 4.1 percent while in the second quarter it fell to 3.1 percent.

"We hope that this investment will strengthen further in line with optimism or confidence in Indonesia's economic recovery," she explained.

Contributors to Indonesia's economic growth came from exports, which soared very high in line with the demand for national prime commodities and manufactured products.

Exports in the first quarter grew 16.7 percent and further increased in the second quarter to 19.7 percent. Meanwhile, imports also soared to support the economic recovery where some production still requires raw materials and capital goods originating from imports.

"This momentum for economic recovery in 2022 is quite constant. Two consecutive quarters show that the recovery is on the track and at levels that are within our expectations or even above what we had anticipated. Therefore, we will continue to maintain this momentum," the minister said.

Reporting by Indonesia Window