Indonesia govt sets 5.3%-5.9% GDP growth forecast for 2023

• Indonesia expects its economy to grow between 5.3% to 5.9% next year, above 2022’s 5.2% growth target, even as it gradually withdraws pandemic-era fiscal support and reinstates strict fiscal rules,its finance minister said.
• The government will use this growth assumption to set 2023 spending plans, adding that the budget will be designed with a deficit of under 3% of gross domestic product, Finance Minister Sri Mulyani Indrawati said.
• 2021’s fiscal deficit was 4.65% of GDP and 2022’s gap is seen around 4%, according to Sri Mulyani’s latest estimate.
• For 2023, Indonesia’s traditional main growth engines, household consumption and investment, should accelerate, while the contribution of exports is seen declining, Sri Mulyani said.
• “We have also identified new sources of economic growth,” she said, citing healthcare services as well as manufacturing of electronics, communication equipment, chemical and mineral processing as potential post-pandemic growth drivers.
• Plans for low carbon developments and energy transition to renewables will also aid growth, she said, adding that the state budget will be geared to support these sectors.
• However, the minister said policymakers would monitor the potential spillover impact from global monetary tightening, which could trigger capital outflows and push government bond yields up.

External Link : https://www.reuters.com/markets/rates-bonds/indonesia-govt-sets-53-59-gdp-growth-forecast-2023-2022-02-16/