Strong consumption boosts GDP growth to 5.27 percent in Q2

INDONESIA - JAKARTA. The Indonesian economy expanded by 5.27 percent year-on-year (yoy) during the second quarter of 2018 thanks to strong growth in consumption, the Central Statistics Agency (BPS) announced on Monday.

The latest figure was better compared to this year first quarter’s growth of 5.06 percent yoy and also 5.01 percent booked in the second quarter of 2017.

Household consumption, which accounted for more than half of GDP growth, grew by 5.14 percent during the second quarter of this year, higher than 4.95 percent booked over the corresponding period last year.

The household consumption growth figure marked the first time that the GDP component broke through 5 percent growth since 2017, during which it usually hovers around 4.9 percent.

“The 5.14 percent [consumption] growth was exceptional,” said BPS head Suhariyanto in Jakarta on Monday, adding that momentum in the fourth quarter in the form of long holidays could also boost consumption going forward.

Investment is the second-largest contributor to GDP growth, which grew by 5.87 percent, lower than 7 percent average growth in the past three quarters but higher than 5.34 percent recorded in second quarter of 2017.

Exports, meanwhile, grew 7.7 percent in the second quarter and imports rose 15.17 percent over the same period.

The activities surrounding the concurrent regional elections in the second quarter have also boosted non-household spending, which grew 8.71 percent.