No.25/169/DKom
The International Monetary Fund (IMF) assesses that Indonesia has shown good economic recovery after the pandemic, supported by strong macroeconomic performance and prudent implementation of monetary and fiscal policies. Forward-looking policies and synergies have led Indonesia to face global challenges in 2022 with healthy growth, reduced inflationary pressures, and a stable financial system. Bank Indonesia welcomes the results of the IMF assessment of the Indonesian economy, as presented in the 2023 Article IV Consultation report released today (26/6).
The IMF Board of Directors extends appreciation and positive notes on the various policies pursued by Indonesian authorities. First, the achievement of the 3 percent deficit ceiling one year earlier than envisaged and commended authorities' commitment to fiscal discipline. Second, the monetary policy has been tightened appropriately to preserve price stability. Third, the financial sector remains resilient. Fourth, the recently adopted legislation on job creation and the financial sector while noting the importance of prompt implementation and continued reform momentum to promote an enabling business environment, enhance financial deepening, and mitigate the scarring effects of the pandemic. Fifth, Indonesia's diversification strategy focuses on downstream activities from its raw commodities. Sixth, the authorities' commitment to limit greenhouse gas emissions and deforestation.
In its report, the IMF projects that Indonesia's economic performance will remain strong with a slight moderation in 2023, given the tightening domestic policies and the normalization of global commodity prices. Nevertheless, the IMF is observing several risk factors that need to be monitored, particularly uncertain global economic and financial conditions that can potentially affect the growth outlook. The IMF delivered policy recommendations on normalizing fiscal and monetary policies towards the pre-pandemic settings, continuing financial sector policies that support inclusive growth, and broadening policy reforms to encourage medium-term growth.
The IMF's positive projection is in line with Bank Indonesia's assessment which estimates that the national economic growth rate will continue in line with the progress of the reform agenda. Bank Indonesia continues to strengthen policy synergy with the Government and the relevant authorities to maintain macroeconomic and financial sector stability, to encourage business growth, specifically in priority sectors to support economic growth and exports, as well as advancing the green and inclusive economy and finance.
Jakarta, 26th June 2022
Head of Communication Department
Erwin Haryono
Executive Director
Information about Bank Indonesia
Tel. 021-131, Email: bicara@bi.go.id
