Indonesia’s economic growth in the third quarter of 2021 is expected to be hampered by the Covid-19 spike

KONTAN.CO.ID – JAKARTA. Economists at Danareksa Research Institute (DRI) forecast economic growth in the third quarter of 2021 in the range of 3.61% year for year (yoy) or lower than second quarter 2021 growth which was 7.07% yoy.

DRI chief economist Rima Prama Artha actually saw a weakening of the economic recovery in the reporting period, which cannot be separated from the development of the Covid-19 case.

“The economic recovery is still weak, consistent with the implementation of Community Activity Restrictions (PPKM), as there was a second wave of Covid-19 early in the third quarter of 2021,” Rima said in her report, as quoted Wednesday (3/11).

Rima then stated that household consumption growth is estimated at 3.61% yoy in the third quarter of 2021, or decreased from 5.93% yoy in the second quarter of 2021.

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This slowdown in growth was also influenced by the restrictions on economic activity. This can also be seen in several leading indicators, such as declining retail sales, particularly in the telecommunications information sector, which decreased by 27.80% year-on-year, in the leisure sector by 12.36% year-on-year and in clothing, which decreased by 12.24% year-on-year .

Sales of durable goods or durable goods Most of all, auto sales seem to be on the rise because of a tax rebate from the government. It is estimated that government consumption will grow 4.26% yoy or less than growth in the second quarter of 2021, which was 8.06% yoy.

Rima believes the decline in growth in this component was caused by the government in the second quarter of 2021, which was too lazy to provide momentum as there were Lebaran and Eid-al-Fitr moments about people’s purchasing power to obtain.

The gross fixed capital formation (PMTB) component or investment is expected to grow only 0.32% year over year.

Meanwhile, export performance will increase by 26.92% year-on-year and imports by 16.60% year-on-year, which is the balance of trade for the period July 2021 to September 2021, which is a large surplus of $ 13.24 billion, $ 6.31 billion.

This increase was driven by the positive development of exports due to increased raw material prices, especially coal. Energy crises in Europe, India and China are increasing the demand for coal.