Indonesia's consumer optimism was getting stronger in November, indicated by the consumer confidence index (CCI) which increased to 124.2 - Photo by TheInsiderStories

JAKARTA (TheInsiderStories) – Indonesia’s consumer optimism was getting stronger in November, indicated by the consumer confidence index (CCI) which increased to 124.2 from 118.4 month earlier, Bank Indonesia (BI) wrote in the latest survey published today (12/05).

BI stated, the increasing consumer optimism was driven by the improvement of consumer perceptions toward current economic conditions and consumer expectations of future economic conditions. It has occurred in all expenditure groups.

The enhancement of consumer perceptions toward the current economic conditions was driven by better perceptions of job availability, current income, and purchases of durable goods. In addition, consumers have better expectations of future economic conditions, both in terms of business activities, availability of employment, and income.

The survey also indicated the slowdown of rising prices procurement in the next three months or in February 2020. This is reflected in the price expectation index (PEI) for the next three months which declined from the previous month.

Meanwhile, the upward pressure on prices is expected to increase slightly in the next six months or on May 2020. This is reflected in the PEI for the next six months which is higher than the previous month. The increase was mainly driven by the increase of demand for goods and services during the Ramadan and Eid periods.

Consumer optimism is one of the factors influenced inflation and economic growth. While, the government strives to bring Indonesia’s economy to grow to 5.6 percent in 2020, from the 5.3 percent targeted this year. The figure mainly supported by investment which is expected to increase by 7.0-7.4 percent and exports rose at 5.5-7.0 percent.

On the supply side, economic growth is expected to be supported by the industrial sector which will increase between 5.0-5.5 percent. While the unemployment rate is expected to fall to 4.8-5.0 percent, accompanied by a reduction in the poverty rate in the range of 8.5-9.0 percent.

To achieve that target, Coordinating Minister for the Economy Airlangga Hartarto said the government had mapped out strategies and priority steps to be taken to face economic challenges in 2020, both internally and externally.

First, the government will increase economic growth through structural transformation to strengthen domestic demand and international trade performance.

Second, maintaining macroeconomic stability by positioning domestic prices and the exchange rate at a stable and competitive level. Third, increase inclusiveness and a sustainable economy.

“Increasing competitiveness is also one thing that is the focus of attention. Sustainable economic growth is also needed to get out of the poverty line and encourage human development,” Hartarto said.

Regarding investment, the government will optimize the online single submission system, increase the effectiveness of the investment acceleration task force, relax the negative investment list, and approve investment priority sectors, Hartarto noted.

In addition, the implementation of the tax holiday and super deduction tax and the development of the national strategic project, special economic zones, and industrial estates are also the mainstay policies. The government is also preparing the omnibus law, aims to further simplify the licensing process, the minister said.

Written by Staff Editor, Email: theinsiderstories@gmail.com