Indonesia: BI expects 1Q20 economic growth to drop to 4.9% as virus hurts tourism, trade

  • Bank Indonesia (BI) is predicting that weakening economic activities, especially involving tourism, exports and imports, would drag down the country’s economic growth to 4.9% in the 1Q20 before picking up to near 5% in the 2Q20, 5.1% in 3Q20 and 5.2% in 4Q20.
  • BI Governor Perry Warjiyo said on 4 Mar 20 the coronavirus had hurt export-import businesses and tourism-related industries in Feb 19, adding that he expected the trend would likely continue, but finally bottom out in 19 Mar 20.
  • The same trend was also seen in the financial market with foreign investors selling a net IDR30.8tr (USD2.17bn) through 19 Feb 20 until 27 Feb 20, of which IDR26.2tr was in government bonds and IDR4.1tr in stocks, said Perry.
  • The central bank governor mentioned that the growth projection would be made possible if there was a “very strong and coordinated effort” to support the economy.

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