Indonesia's GDP Registers 3.69% Growth In 2021 After 2.07% Contraction In 2020 But Still Below Pre-pandemic Trend Of 5%

Indonesia's gross domestic product (GDP) recorded an annual growth of 3.69% in 2021, according to data released by Statistics Indonesia on Monday (Feb 7).

The GDP of the country, which is Southeast Asia's largest economy, had contracted by 2.07% in 2020.

2021 GDP growth numbers is still below the pre-pandemic trend of 5% annual expansion.

"Indonesia’s economy in 2021 grew 3.69 percent, higher than the achievement in 2020, which experienced a growth contraction of 2.07 percent. The highest growth on the production side was Human Health and Social Work Activities at 10.46 percent." a statement by Statistics Indonesia said.

Thanks to the lifting of pandemic-induced restrictions and record-high exports driven by stronger commodity prices, Indonesian economy registered a 5.02 percent on an annualised basis in the October-December quarter, compared with 3.51 percent growth in the previous quarter.

Indonesia is one of the biggest exporters of palm oil, coal and nickel. The last quarters received a boost thanks to the surge in demand for these commodities.

The International Monetary Fund in its World Economic Outlook update in January lowered its projection for Indonesia's 2022 GDP growth rate to 5.6%, from the 5.9% it had previously forecast, while cutting its 2023 prediction to 6.0% from 6.4%. The IMF cited reasons including uncertainty due to pandemic, expected global monetary tightening and country's own scaling back the level of monetary and fiscal stimulus, as reasons for downward revision.

2021 GDP growth numbers is still below the pre-pandemic trend of 5% annual expansion.