Government spending can spur higher growth in IndonesiaStaff writer ▼ | December 16, 2015
The government’s increased capital spending by close to 50 percent year-on-year in real terms supported growth in Q3 and could further boost growth in 2016 if the pace continues, says World Bank.
Asia Additional reforms in Indonesia
The forest fires this year have also constrained GDP growth, costing Indonesia an estimated $16.1 billion, equivalent to 1.9 percent of GDP or more than twice the costs of reconstruction in Aceh after the tsunami.
The GDP of Kalimantan, the worst affected island, declined by 1.2 percent quarter-on-quarter in the third quarter, in part due to the fires and haze. Growth in East Kalimantan declined by 3.5 percent year-on-year, and in Papua by 0.6 percent year-on-year. ■