The Indonesian rupiah (Photo: Reuters)

 

Jakarta (VNA) – The World Bank (WB) has projected that the Indonesian economy would grow 5.2 percent this year, higher than the figure of 5.18 percent put forward by the country’s government.

WB also revealed some estimates for Indonesia, with inflation rate staying at 3.5 percent and budget deficit at 2.1 percent of the country’s gross domestic product. 

Private consumption and investment are expected to strengthen. In the first quarter of 2018, the two figures rose by 4.95 percent and 7.9 percent, respectively.

The WB Country Director for Indonesia, Rodrigo A. Chaves, said the investment growth in Indonesia is still high, considering the increasing prices of commodities. 

However, more investment will increase the amount of imported goods. The rising trade protectionism and the real risk of the recent global trade may stop and burden Indonesia’s exports, thus hampering its growth.

The global economy would grow slower due to tightening monetary conditions and fluctuations in developing economies such as Argentina and Turkey, Chaves added.

The WB also noted that Indonesia’s current account deficit will grow due to high demand in domestic market, weak trade conditions and slow global economic growth.

Earlier on June 5, at a discussion to build a draft law on state budget in 2018, the Government and the House of Representatives have agreed on a target of an economic growth of 5.2-5.6 percent this year.-VNA