Heaptalk, Jakarta — Indonesia’s economy grew by 4.95% year-on-year in the third quarter of 2024, compared to last year’s period, with growth observed across all sectors. As measured by Gross Domestic Product (GDP) at current prices, Indonesia’s economy reached Rp5,638 trillion in the third quarter of 2024. Meanwhile, GDP at constant 2010 prices stood at Rp3,279 trillion.
Indonesia’s Central Bureau of Statistics (BPS) reported that the other services sector saw a substantial increase of 9.95%, followed by Transportation and Warehousing at 8.64% and Accommodation and Food and Beverage Services at 8.33%. Meanwhile, the Manufacturing industry, a significant contributor to the national economy, recorded a growth rate of 4.72%.
All expenditure components experienced positive growth. Household Consumption grew by 4.91%, contributing the highest to overall growth at 2.55%, primarily driven by increased activity in the hotel and restaurant sectors. Meanwhile, Gross Fixed Capital Formation (GFCF) expanded by 5.15%, fueled by public and private investment, particularly in infrastructure development.
Well-contained and low inflation rate underpinned Indonesia’s economic growth in the third quarter of 2024, maintained within the target range of 2.5% ±1%, reaching 1.71% in October 2024. This growth was further bolstered by a prudent fiscal stance, reflected in a controlled debt-to-GDP ratio of 39.4% as of June 2024. Indonesia’s economic resilience and performance continue to demonstrate notable strength, outpacing that of several advanced and emerging economies, including Singapore (4.1%), Saudi Arabia (2.8%), and Mexico (1.5%).
To stimulate economic growth in the upcoming quarter, Indonesia’s Coordinating Minister for Economic Affairs, Airlangga Hartarto, outlined a series of strategic policy initiatives the government plans to implement, spanning:
- Strengthening Consumer Purchasing Power: Key measures include extending fiscal incentives, notably the exemptions for Value-Added Tax (VAT) and Luxury Goods Sales Tax (PPnBM) in the property and automotive sectors. Additionally, the government will expand the quota for the Housing Financing Liquidity Facility (FLPP), promote the utilization of the Employment Social Security (JKP), and encourage access to Workers’ Compensation (JKK) funds. To further empower entrepreneurship, increased access to financing through the People’s Business Credit (KUR) program will also be prioritized.
- Increasing Natural Resource Value-Addition: To elevate the economic contribution of Indonesia’s natural resources, the government will advance downstream processing for 26 essential commodities. This initiative aims to enhance these resources’ value, optimizing their impact on national economic growth.
“We have implemented a range of strategic measures to bolster economic competitiveness, including the optimization of national strategic projects, the expansion of industrial and special economic zones, and the provision of tax holiday incentives formalized under Minister of Finance Regulation No. 69 of 2024.” Minister Airlangga affirmed.
