Monday, 18 February 2008

Indonesian GDP growth slows in 4th quarter, but 2007 growth is highest in decade

JAKARTA (AP): Indonesia's economy grew at a slowerpace in the fourth quarter compared to the third, but its 2007 growth rate was the fastest in a decade because of rising investments and commodity exports, the government said Friday.

Southeast Asia's largest economy grew 6.25 percent in the October-December quarter compared to a year ago, slowing from growth of 6.52 percent in the third quarter, the Central Statistics Agency said Friday.

For all of 2007, gross domestic product grew 6.32 percent, picking up from 5.5 percent growth in 2006, and slightly exceeding the government target of 6.3 percent.

Indonesia President Susilo Bambang Yudhoyono, however, warned Friday the government expects slower economic growth, higher inflation and a wider budget deficit this year than originally forecast due to the uncertain global economic climate.

The domestic economy will likely expand 6.4 percent this year rather than the 6.8 percent forecast earlier as a "global economic slowdown will also affect Indonesia," the president said to a gathering of the heads of provincial governments.

Inflation will hit 6.5 percent this year, higher than the 6 percent originally forecast, while the dollar will average 9,150 Indonesia rupiah, stronger than the 9,100 earlier predicted, he said.

The budget deficit is expected to be 2 percent of gross domestic product, wider than the 1.7 percent earlier forecast.

(Source: The Jakarta Post, 2008)