The economy continued robust into year-end 2024
As the year 2024 comes to a close, the Indonesian economy has continued robust as reflected by a number of indicators. The most important indicator, Indonesia's GDP, reported annual growth of 5.03% for the first three quarters of 2024. Even though the rate of growth in the third quarter reached just 4.95%, the average rate of growth for the past three quarters was above the 5% threshold.
In Indonesia, the recent public discussion has centered on the decline in purchasing power of the Indonesian people. However, some micro indicators showed differently. A number of important players in the Fast-Moving Consumer Goods (FMCG) industry, as well as retail sectors including household appliance and other companies, have displayed positive growth. In fact, many displayed double-digit growth. The only prominent player that recorded negative growth, with sales down more than 10%, was Unilever Indonesia, which cited a decline in purchasing power as the factor that drove sales lower.
The Indonesian government accounts also posted robust results. The Indonesian government has already spent Rp.2,894.5 trillion, or 87% of its expenditure budget. At the same time, government revenue reached Rp.2,492.7 trillion, or 89% of budget. Therefore, the budget deficit up to November 2024 reached Rp.401.8 trillion or 1.81% of GDP. This is considered robust since the government deficit target for 2024 is Rp.522.8 trillion or 2.29% of GDP. With one month remaining, it can be expected that the budget deficit will manage to come in below target.
The Central Board of Statistics in Indonesia also released its balance of trade report for November 2024. Exports remained robust, coming in at $24,007.2 million, while imports also remained strong (although at a lower level than the previous month), reaching $19,587.6 million. Given these figures, the trade balance in November registered a surplus far higher than the previous month: the surplus in November was $4,419.6 million compared to $2,483.3 million in October. Cumulative exports from January to November 2024 reached $241,251.0 million, while cumulative imports for the same period were $212,393.4 million, so the total trade surplus from January until November 2024, at $28,857.6 million, was 14.1% lower than the $33,604.1 million achieved in the same period of the previous year.
The Central Board of Statistics also reported the Consumer Price Index for November, which registered inflation of 0.30%. With that monthly inflation, Y/Y inflation in November reached 1.55%, a level at the lower part of the inflation corridor administered by the Central Bank. Against that background, Bank Indonesia decided to keep the benchmark rate constant at 6.00% at its policy meeting held on December 17-18, 2024.
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