Indonesia Economic Quarterly, June 2016 : Resilience through Reforms
This Indonesia Economic Quarterly (IEG) quarterly report covers the economic growth of Indonesia as in June 2016. With the global recovery yet to be realized, Indonesia’s resilience stands out among commodity exporters. A number of good policies ha...
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| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
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| Online Access: | http://documents.worldbank.org/curated/en/458091542207517162/Indonesia-economic-quarterly-resilience-through-reforms http://hdl.handle.net/10986/30872 |
| Summary: | This Indonesia Economic Quarterly (IEG)
quarterly report covers the economic growth of Indonesia as
in June 2016. With the global recovery yet to be realized,
Indonesia’s resilience stands out among commodity exporters.
A number of good policies have contributed to Indonesia’s
resilience. First, prudent monetary and exchange rate
policies, along with international financial conditions that
are more favorable than a year ago, have helped reduce
inflation and stabilize the Rupiah. These factors, as well
as lower energy prices, have supported aggregate household
consumption. Second, public infrastructure spending has
become a priority within Indonesia’s limited fiscal space.
Gross domestic product (GDP) growth in first quarter (Q1)
2016 was 4.9 percent year-on-year (yoy), with public
spending lower than expected. The current account deficit
narrowed to 2.1 percent of GDP, as imports fell faster than
exports. Fiscal policy in Indonesia has not been very
effective in reducing inequality, but the fuel subsidy
reform has helped. The 2015 fuel subsidy reform, and related
compensation for the poor, has helped reduce inequality, as
savings were redirected into infrastructure, health, and
social assistance. |
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