In the Straits Times, Finance Minister Sri Mulyani Indrawati wrote that she is optimistic about Indonesia’s economic outlook.

“Despite the global economic and geopolitical volatility, Indonesia's economy continues to expand, chalking up around 5 per cent growth in the second quarter. The positive growth outlook is driven by consumption, investments and recovery in exports,” she said.

Encouraging signs for Indonesia’s economy:

• Standard & Poor's lifted Indonesia's credit rating to investment grade
• The UN Conference on Trade and Development recognised Indonesia as the fourth-most attractive destination for investment
• Ranking on World Bank's Ease of Doing Business index has improved significantly
• Indonesia’s rank on the World Economic Forum's Global Competitiveness Report improved by five places
• OECD's recent Gallup poll indicates that 80 per cent of Indonesians have confidence in their national government

She continues, “All the necessary factors to support robust consumption are there: solid new job growth, increase in real wages, low and stable inflation at around 4 per cent - including stable food prices, strong consumer confidence and a low interest rate - and a stable exchange rate.

“The government is introducing key reforms to create a more conducive investment climate and invite more private capital to bolster our inclusive growth. Total direct investments - domestic and foreign - in the first half of the year have been strong, and reached 336.7 trillion rupiah (S$30 billion). This is an increase of almost 13 per cent from last year's performance.

“Indonesia is undergoing an infrastructure revolution. As far as the eyes can see, people in construction hats are working tirelessly to meet their deadlines. In fact, we are spending more on infrastructure than on personnel and recurrent spending. We will further boost private sector participation in infrastructure development and create positive synergies with state-owned enterprises. These investments will make our economy even more competitive going forward.

“The budget allocates a large portion to education, health, basic services and social spending. These human capital investments will translate into a potent workforce that will be ready for the jobs of tomorrow and will drive inclusive growth”.

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