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Indonesia's economic growth picks up slightly in Q3
[JAKARTA] Indonesia's economy has staged a slight comeback, recovering from dismal growth figures earlier in the year, but analysts said Thursday it was still nowhere near enough to meet the ambitious promises of President Joko Widodo, also known as Jokowi.
Spending on infrastructure projects, a driver of Indonesia's sagging economy, helped push third quarter growth figures back from recent lows, though the result still didn't meet expectations.
Analysts were nonetheless cautiously optimistic that Indonesia's economy, the largest in Southeast Asia, could ride the momentum into the final quarter of the year after a tough 12 months.
In a statement Thursday, the Statistics Agency said the economy grew 4.73 per cent in the period of July to September, after slipping to 4.67 per cent in the previous three months, the lowest in six years.
"The momentum for a pick up has begun to appear," Bank Central Asia's economist David Sumual told AFP.
Increased government spending and the kick-starting of key infrastructure projects, coupled with a spike in the cement production, had helped carry things along in recent months, he added.
But far more will be needed to push growth above the 7 per cent promised by Jokowi upon taking office 12 months ago.
His image as a "man of the people" who would fulfil his commitments has been dented as he has struggled to turnaround the ailing economy and weather economic headwinds at home and abroad.
The slowdown in China's economy, coupled with the shock devaluation of the yuan and uncertainty over a possible US Federal Reserve rate hike, has battered Indonesia's market and currency in 2015.
Factors at home haven't helped, with the country's Statistics Agency blaming widespread haze from raging forest fires across the country for disrupting the local economy.
Indonesia had enjoyed above 5 per cent growth in recent years with the exception of 2009 due to a global slowdown.
Economists said that despite a slight uptick of the recent quarterly growth, Indonesia will post the slowest growth of under 5 per cent for full year 2015.