RESTRICTIONS STILL IN PLACE
GDP shrinks more than expected in Q2.
- Statistics Indonesia (BPS) announced last week that Indonesia’s gross domestic products (GDP) contracted by 5.32 percent in the second quarter. Indonesia’s economy suffered its sharpest downturn since the 1998 Asian financial crisis in the second quarter, as the COVID-19 pandemic shut down large parts of the country, ravaging businesses and leaving millions out of work.
- Household spending, which makes up more than 50 percent of GDP, fell by 5.51 percent led by a near-total collapse in spending on restaurant meals, recreational services, and transportation, among others.
- Investment, meanwhile, fell by 8.61 percent, as businesses pulled back sharply on their investment in vehicles and other products.
- Government expenditure fell by 6.9 percent as government cut spending on business trips and cancelled events.
- Exports and imports also plunged 11.66 percent and 16.96 percent, respectively, reflecting the slowdown in global economic activity as the pandemic hits.