Indonesian economy to regain growth momentum from second quarter

Testing for COVID-19 in Indonesia (Photo: Xinhua)

Jakarta (VNA) -  Although the Indonesian Government’s National Economic Recovery (PEN) programme has accelerated the country’s economic recovery post COVID-19, the economy may still be in recession in the first quarter of this year, given the adverse impact of the pandemic.

Economist of the Bank Rakyat Indonesia (BRI) Anton Hendranata said about 56.7 percent of the loans launched under the programme to assist State-owned enterprises have proven effective.

He expressed his belief that the extension of fiscal incentives of the Indonesian Government this year would continue to help the economy escape from the downturn.

According to him, the Indonesian economy will gain its stability and growth momentum from the second quarter, and grow strongly from mid-year.

The Indonesian Government has also recently issued a new regulation on investment, which includes the removal of some restrictions on foreign investment in a bid to boost investment into its pandemic-hit economy.

The new rules for the law, often referred to as the "omnibus law" passed last year, remove Indonesia's negative investment list, which covers businesses not open to foreign investment, although still maintain caps on foreign investment in certain sectors.

The new rules will come into effect 30 days from February 2./.