Indonesia’s economy may contract 0.4% in worst case scenario, says finance minister


  • Indonesia
  • Wednesday, 01 Apr 2020

Jakarta's light rail. - The Jakarta Post

JAKARTA (The Jakarta Post/ANN): The Indonesian government has outlined a worst-case scenario where the domestic economy could contract by 0.4 per cent as the Covid-19 pandemic arrests swaths of economic activity and poses recessionary risks to Southeast Asia’s largest economy.

Finance Minister Sri Mulyani Indrawati said the baseline scenario was for economic growth to sit at 2.3 per cent this year as trade contracted and consumption and investment growth slowed.

“We are forward-looking, so the steps we’re taking are preventive measures, ” Sri Mulyani said at a media briefing on Wednesday (April 1).

Covid-19 had disrupted household activities, hampered firms’ sales and revenue and had hit micro, small and medium businesses, she added.

President Joko “Jokowi” Widodo announced Rp 405.1 trillion (US$24.8 billion) in extra spending on Tuesday to finance Indonesia’s fight against Covid-19. Of this, Rp 150 trillion will be set aside for economic recovery programs, Rp 75 trillion for healthcare spending, Rp 110 trillion for social protection and Rp 70.1 trillion for tax incentives and credits for enterprises. - The Jakarta Post/Asia News Network

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