US supports Indonesia to become the centre of world economic growth: PPP scheme stimulates economy after the pandemic
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Investor Daily - AS dukung Indonesia jadi pusat pertumbuhan ekonomi dunia: Skema PPP pacu ekonomi setelah pandemi
15 November 2022
By: Harso Kurniawan
State-owned Enterprises Minister Erick Thohir accompanied President Joko Widodo (Jokowi) during the bilateral meeting with US President Joe Biden in Nusa Dua, Badung Regency, Bali on Monday (14/11). During the occasion, Biden stated that he supported Indonesia becoming the centre of world economic growth.
Erick stated that the meeting was held approaching the G20 Summit from 15-16 November 2022. “Alhamdulilah (praise be to God), President Jokowi has met US President Joe Biden. The President appreciates the attendance of Biden at the G20 Summit in Bali,” Erick said.
Erick said that Biden appreciated Indonesia’s leadership at the G20 Summit. Biden reckoned that Indonesia had a large potential to progress thanks to the abundant natural resources and quality workforce.
“Earlier, Biden stated that he was hopeful about Indonesia’s role as the leader of Southeast Asia, and he hopes that Indonesia can strengthen the relationship among countries in Southeast Asia with the US, ” Erick said.
Erick said that the seriousness of the Indonesian government in accelerating energy transition got the world’s attention, including the US. Biden fully supports Indonesia’s step to make a transition to renewable energy. “Biden is also committed to supporting the improvement and development of Indonesia’s economy as the centre of world economic growth,” Erick added.
Previously, International Monitory Fund (IMF) had lowered the growth prospect of the global economy by three times to only 3.2% this year, then it would be decreased again next year to 2.9%. Uncertainty is very high during war and a pandemic, so there is a possibility that there will be more economic turmoil. IMF predicts that countries that contribute by one third of the global economy are currently experiencing economic contraction for least two quarters in a row this year or next year.
However, IMF mentioned that Indonesia was a bright spot amid the darkness of the global economy next year. IMF predicts that Indonesia’s economic growth in 2022 will reach 5%. Moreover, in the 2023 state budget (APBN), Indonesia’s economic growth is set to reach 5.3%. Based on the data from Statistics Indonesia, economic growth in the third quarter of 2022 reached 5.72%, second quarter reached 5.4%, and first quarter 5.01%. As of September 2022, economic growth has reached 5.4%, compared to the same period in 2021.
Economic transformation
On the other hand, Coordinating Minister for Economic Affairs Airlangga Hartarto stated that transformation in various sectors was the key to face the current global challenge by utilising opportunities from industrial revolution 4.0, artificial intelligence, and various other innovations. To support the transformation, cooperation is required among various parties, including public-private partnership (PPP).
“Public-private partnership that is supported by the utilisation of various innovations will be a foundation that strengthens the economic architecture after the Covid-19 pandemic,” Airlangga Hartarto said during Business20 (B20) Summit on Monday (14/11).
He said that PPP was also expected to provide solutions for various strategic issues, starting from food security to affordable and fair energy transition. With the partnership, Indonesia’s economic growth is predicted to reach 5.4% in 2022, which is higher than the initial estimation of various global organisations.
“In the third quarter of 2022, the economy grew 5.72%. Most of the growth came from sectors that have recovered well. Currently, the Covid-19 pandemic is under better control,” Coordinating Minister Airlangga said.
