Indonesia is Predicted to Be the Fifth -Largest Economy in 2024: Perseverance in 2020 is a Key
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By Badan Kebijakan Fiskal Kementrian Keuangan
Press conference | January 17, 2024
Jakarta, 22 July 2020 – In the midst of a pandemic that is threatening the global economy, as seen by the decline in growth estimates for several nations, Indonesia has received some encouraging news. According to World Bank and IMF data (Gross Domestic Product-Purchasing Power Parity), Indonesia is expected to become the world's fifth biggest economy by 2024. Febrio Kacaribu, the head of the Fiscal Policy Agency, stated that "hardwork in handling Covid-19 2020 will greatly determine recovery in the following years."
In general, in 2024 there will be the biggest shift in the economic structure world. Asia will increasingly dominate the top 5 positions, shifting the positions of several European countries. After China and Japan, which are currently in the top 5 positions, India and India are predicted to replace England and Germany. Apart from the important 2020 base, one of the reasons behind this shift in economic dominance is the growth of the middle class in Asia.
Apart from the middle class, demographics also make a positive contribution to the shift in dominance of Asia. According to the World Economic Forum, China is predicted to continue to decline Its growth is in line with its aging population, Indonesia, the Philippines, and Malaysia are expected to become Asian economic champions with the motor of growth in the form of an increasing workforce.
Estimates of the structure of the largest economy in the world use comparison of projections economic growth in the next few years, including 2020 as well as the economic recovery process in the following years. Based on World Bank and IMF projections, several countries with the largest GDP in 2020 are predicted to experience disasters growth, negative such as the US (-6.1%, yoy), Japan (-6.1%, yoy), Germany (-7.8%, yoy), and Brazil (-8.0%, yoy).
Meanwhile, predictions for economic growth in 2020 for Asian countries are also very low, in fact 3 countries are predicted to grow negatively, namely Malaysia (-3.1%, yoy), Thailand (-5.0% yoy) and the Philippines (-1.9%, yoy). Even though it is better than other Asian countries, Indonesia and China are also under pressure with economic growth of 0.0% (yoy) and 1.0% (yoy).
We need to be grateful for this prediction and act as motivation for Indonesia. The government must continue to implement appropriate policies in the context of handling the Covid-19 pandemic and national economic recovery. In this way, it is hoped that the impact of the crisis can be minimized, the economy will quickly recover, and Indonesia can continue to realize its aspirations to become a large and advanced economy in the world.