Government Optimistic 5 Percent Growth Will Effectively Prevent Economic Weakening
JAKARTA – Amid global pressure and economic uncertainty due to the tariff war between the United States (US) and China, the Indonesian Government remains optimistic that national economic growth in 2025 can reach 5 percent. This belief emerged even though international institutions such as the International Monetary Fund (IMF) and the World Bank revised their projections for Indonesia’s economic growth from 5.1 percent to 4.7 percent.
Secretary of the Coordinating Ministry for Economic Affairs, Susiwijono Moegiarso, explained that Indonesia’s economic structure, which relies more on the domestic market, makes it more resilient to external shocks.
“Our dependence on the global economy is not as high as other countries. Domestic consumption, especially household consumption, plays a major role in our GDP growth. This is important capital in facing global dynamics,” he said.
Susiwijono also highlighted that the IMF’s correction of Indonesia’s economic growth of 0.4 percent is still much lower than the corrections for other countries such as Thailand (1.1 percent), Vietnam (0.9 percent), and Mexico (1.7 percent).
“Our outlook is still much better. Even compared to the US and China, which are both directly involved in the tariff war, Indonesia’s projection remains relatively stable,” he said.
The government also continues to strive to minimize the impact of retaliatory tariffs from the US, which are currently in the negotiation process. Indonesia is one of the first countries to be accepted in technical discussions with the US regarding the imposition of import tariffs set at 32 percent.
“We have 60 days and the negotiation process is quite progressive. This opens up space for a resolution that is more beneficial to Indonesia,” explained Susiwijono.
Meanwhile, Finance Minister Sri Mulyani Indrawati also strengthened the government’s optimism. The Minister of Finance emphasized that Indonesia’s economic growth would remain stable in the first quarter of 2025 thanks to strong household consumption, government spending on THR and social assistance, and the continuation of national strategic projects (PSN).
“Investment performance has also increased, supported by imports of heavy equipment and business actor confidence,” said Sri Mulyani.
Andalas University economist Syafruddin Karimi reminded that the 5 percent growth target is not something that can be achieved automatically.
“It takes the right strategy, adaptive policy execution, and anticipation of external dynamics. Without that, opportunities can turn into challenges,” she said.
Amid the decline in the global economic growth projection from 3.2 percent to 2.8 percent by the IMF, Indonesia continues to show resilience. Export performance is predicted to remain positive, especially from main commodities such as CPO, iron and steel, and electrical machinery and equipment.
The government considers this as a momentum to strengthen the foundation of the domestic economy while maintaining investor and business confidence. The government is also exploring export market expansion to the ASEAN+3, BRICS, and European regions to reduce dependence on the US market.
With a cautious but optimistic approach, the government is confident that the 5 percent figure is still within reach, making Indonesia one of the countries that is able to survive the global economic storm this year.
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