Indonesian GDP Growth Slows to 5.62% YoY in Q3

In the third quarter of 2013, Indonesian economy expanded by an annual 5.62 percent, the lowest growth rate in nearly four years. A surge in government spending was not enough to offset a slowdown in investment, hurt by higher borrowing costs as the central bank rose the interest rate by 150 bps since June to curb inflation and a slide in the currency.

On the production side, all sectors expanded at a slower pace than in the previous three-month period, except for mining and quarrying, which recovered in the third quarter and rose by an annual 1.62 percent (up from a 1.2 percent contraction in the previous quarter). Services also accelerated to 5.62 percent from 4.48 percent in the June quarter.

Year-on-year, the transport and communication sector recorded the highest annual growth rate (10.5 percent, slightly down from 11.5 percent in the previous quarter), followed by financial and real estate services (8.09 percent) and construction (6.24 percent). Trade, hotels and restaurants expanded 6 percent; manufacturing rose 4.9 percent and electricity, gas and water increased 4 percent. Agriculture expanded 3 percent. 

On the expenditure side, only investment decelerated in the September quarter. Gross fixed capital formation rose 4.51 percent year-on-year, slightly down from 4.67 percent in the previous quarter. In contrast, government consumption accelerated to an annual growth of 8.82 percent (2.1 percent in the previous quarter) and private consumption rose 5.48 percent (up from 5.06 percent in the second quarter). Exports surged 5.3 percent, 0.5 percentage point higher than in the June quarter and imports went up 3.8 percent. 

On a quarter-on-quarter basis, the economy accelerated to 2.96 percent, the highest growth rate in the last four quarters. 

In the first nine months of 2013, Indonesian GDP grew 5.83 percent over the same period last year. 

Indonesian GDP Growth Slows to 5.62% YoY in Q3

Joana Taborda |
11/6/2013 11:35:43 AM