Indonesia's economy remains resilient in the face of global market volatility, according to Finance Minister Purbaya Yudhi Sadewa. Backed by strong GDP growth, robust exports, and stable inflation, the government views the national economic outlook for the remainder of 2025 as increasingly optimistic.

Speaking at the APBN KiTA press conference on Monday, Minister Purbaya emphasized that Indonesia stands among a select group of countries demonstrating resilience despite economic pressures triggered by rising global tariffs and shifting monetary trends.

“The economies of various countries remain resilient through 2025, even as the US applies high reciprocal tariffs. Indonesia is part of the resilient group,” said Purbaya.

Positive Growth Outlook as IMF Upgrades Indonesia's 2025 Forecast

In a move reflecting renewed optimism, the International Monetary Fund (IMF) revised its global economic projections upward. Indonesia was among the countries to benefit from the adjustment, with its GDP growth forecast for 2025 raised from 4.7% to 4.8%.

The government, however, believes this figure remains conservative.

“I think we’ll surpass that. Even this year, it will likely be above 4.8%,” said the Finance Minister.

Official data from Statistics Indonesia (BPS) confirmed a 5.12% GDP growth in Q2 2025, fueled by strong domestic consumption and rising investment. Household spending increased by 5%, while investment grew by 6.99%.

Manufacturing and Investment Lead Q2 Growth Recovery

The manufacturing sector, Indonesia’s largest economic contributor, experienced a significant rebound in the second quarter. The sector expanded by 5.68%—its highest rate since 2022.

“Our manufacturing started to recover in Q2. Maybe Q3 will slow slightly, but Q4 is expected to accelerate with improved demand and increased liquidity,” Purbaya stated.

The recovery is further supported by easing monetary conditions and increased fiscal coordination.

Exports Surge Despite Trade Tariff Pressures

Indonesia's export performance continues to impress despite mounting global trade challenges. Customs data up to August 2025 shows exports increased by 7.8% year-on-year, led by downstream industries and mineral processing—particularly nickel and copper.

From January to August 2025, the cumulative trade surplus soared by 52.3% compared to the same period last year, signaling enhanced export competitiveness.

“This is a spectacular growth. Even if people say it's front-loading ahead of tariffs, it’s still real growth,” said Purbaya.

Stable Inflation Anchors Domestic Demand and Policy Momentum

Inflation stability is proving crucial to preserving consumer purchasing power. As of August 2025, annual inflation stood at 2.31%—well within the global consensus range of 1–3%.

“Good inflation isn’t zero, nor above 10 percent. The global consensus is between 1 and 3 percent, and we’re at 2.3 percent, which is just right,” the Minister explained.

This stable inflation, alongside a recent 25 basis point rate cut by Bank Indonesia, aims to stimulate lending and productive investment.

“Everything is now set for the economy to move faster. With lower interest rates, consumption and investment will rise, and the multiplier effect will strengthen growth,” said Purbaya.

With strong domestic demand, positive export trends, and synchronized policy efforts, Indonesia’s economy is expected to close 2025 on a high note. The government remains confident that current momentum will lay a foundation for long-term, sustainable growth.

PHOTO: KEMENKEU/BLOOMBERG TECHNOZ

This article was created with AI assistance.