Economic Growth of Indonesia in Quarter I-2014 Projected at 5.75%

Indonesia's Quarterly GDP Growth 2009–2013 (annual % change):

Year	Quarter I	Quarter II	Quarter III	Quarter IV
2013	6.03	5.89	5.62	5.78
2012	6.29	6.36	6.16	6.11
2011	6.45	6.52	6.49	6.50
2010	5.99	6.29	5.81	6.81
2009	4.60	4.37	4.31	4.58

^{Source: Statistics Indonesia (BPS)}

Gross Domestic Product of Indonesia 2006-2013:

	2006	2007	2008	2009	2010	2011	2012	2013
GDP (in billion USD)	285.9	364.6	432.1	510.2	539.4	706.6	846.8	878.0
GDP (annual percent change)	5.5	6.3	6.1	4.6	6.1	6.5	6.2	5.8
GDP per Capita (in USD)	1,643	1,923	2,244	2,345	3,010	3,540	3,592	-

^{Sources: World Bank, International Monetary Fund (IMF) and Statistics Indonesia (BPS)}

Basri explained that economic expansion of Southeast Asia's largest economy in 2014 will be less impressive as the government and Bank Indonesia have deliberately put the foot on the brakes of GDP growth in order to safeguard financial stability. For example, the country's benchmark interest rate (BI rate) was raised gradually from 5.75 percent in June 2013 to 7.50 percent in November 2013 to curb domestic demand. This measure was needed to combat high inflation (accelerating to almost nine percent year-on-year after the Indonesian government raised prices of subsidized fuels in June 2013), ease the current account deficit (which hit a record high at USD $9.9 billion in the second quarter of 2013), as well as to support the rupiah exchange rate (which depreciated sharply between May and December 2013 amid high global uncertainty caused by the looming end of the Federal Reserve's quantitative easing program).

However, Basri believes there is a chance that economic expansion in Q1-2014 will surpass his projection, provided that the country's export in March is strong. According to BPS, Indonesian exports in February 2014 rose 0.68 percent to USD $14.57 billion from January (particularly jewelry exports surged). However, when we compare total exports in the first two months of 2014 with total exports in the same period in 2013, Indonesia posted a 4.44 percent decline in exports.

Indonesia's Trade Balance 2014 (in billion US Dollar):

2014	Export			Import
Month	Oil & Gas	Non Oil & Gas	Total	Oil & Gas	Non Oil & Gas	Total
January	2,50	11,97	14,47	3,55	11,37	14,92
February	2,66	11,91	14,57	3,46	10,33	13,79
Jan-Feb	5,16	23.88	29,04	7,01	21,69	28,70

Indonesia's Trade Balance 2013 (in billion US Dollar):

2013	Export			Import
Month	Oil & Gas	Non Oil & Gas	Total	Oil & Gas	Non Oil & Gas	Total
January	2,66	12,72	15,38	3,97	11,48	15,45
February	2,57	12,45	15,02	3,64	11,67	15,31
March	2,93	12,09	15,02	3,90	10,99	14,89
April	2,45	12,31	14,76	3,63	12,83	16,46
May	2,92	13,21	16,13	3,43	13,23	16,66
June	2,80	11,96	14,76	3,53	12,11	15,64
July	2,28	12,81	15,09	4,14	13,28	17,42
August	2,72	10,36	13,08	3,67	9,34	13,01
September	2,41	12,29	14,70	3,72	11,79	15,51
October	2,72	12,99	15,70	3,47	12,20	15,67
November	2,77	13,17	15,94	3,70	11,21	15,15
December	3,41	13,58	16,98	4,22	11,24	15,46
Jan-Dec	32,63	149,93	182,57	45,27	141,36	186,36

^{Source: Statistics Indonesia}

Basri's projection for economic growth in 2015 is more optimistic with an estimated 6.1 percentage growth. Next year's growth will be supported by increased fiscal room for government spending as ministerial budgets will be limited. If these funds are spent productively (for example on infrastructure development), then it will attract increased foreign and domestic investments.

The Finance Minister is also confident that the country's current account deficit will ease to a sustainable level of between 2.5 and 3.0 percent of GDP in 2014.

In 2013, the Indonesian economy expanded 5.78 percent. This was the first time since 2009 that the country recorded economic growth beneath the six percent mark.

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