Consolidation to Seize Opportunities

KOMPAS/PRIYOMBODO

Online motorcycle taxi drivers show customer food orders through an application at Grab Kitchen Tendean, South Jakarta, in late October (29/10/2019). Grab Kitchen is an effort to bring customers closer to their favorite local dishes produced by micro, small and medium enterprises (MSMEs) through online food delivery services. Digital economic growth also helps MSMEs grow and develop.

A prediction about Indonesia\'s slowing economic growth has been confirmed by Statistics Indonesia. President Joko Widodo\'s new Cabinet needs to seize the opportunity immediately.

In the third quarter of 2019, Indonesia\'s economy grew 5.02 percent on an annual basis, the lowest since the third quarter of 2017 when it reached 5.06 percent and in the third quarter of 2018 when it stood at 5.17 percent. Until September 2019 our economy grew 5.04 percent annually.

This slowdown in growth has not only occurred in Indonesia, but also in other countries. Economic growth in the ASEAN region is expected to drop to 4.8 percent from last year\'s 5.2 percent.

Even though our economy is growing better than the region’s as a whole, we cannot be complacent. Indonesia needs economic growth above 7 percent to provide quality jobs for more than 260 million people who are mostly of productive age in this period of demographic bonus that we are currently enjoying. High growth needs to be pursued considering the peak of the demographic bonus period is predicted to only occur between 2030 and 2035. After that, the Indonesian population will be an aging one. In many countries – Japan is most often mentioned – such a situation slows economic growth.

KOMPAS/PRIYOMBODO

An aerial photo shows a housing project in the BSD City area of Tangerang, Banten, in late October (28/10/2019). In the aftermath of the presidential election and the Cabinet announcement, lower interest rates and controlled inflation are believed by property businesses and banks to be able to support the growth of consumer credit in the property sector.

The sources of economic growth in general are investment, consumption and exports or trade. According to data from Statistics Indonesia, our investment dropped sharply to 4.21 percent in the third quarter of 2019 (in the 2018 period the rate was 6.96 percent). President Jokowi promised to continue to simplify the bureaucracy to attract investments even though this would take time.

We still have a chance by intensifying our domestic resources. Consumer consumption grew 5.1 percent (it was 5 percent in the same period last year). It is a blessing from the demographic bonus that must continue to be encouraged.

The digital age must encourage inter-regional trade in Indonesia, including using the artificial intelligence (AI).

The government’s money can be spent on domestic products. The government also needs to promote the “Love Indonesian products” movement again. The digital age must encourage inter-regional trade in Indonesia, including using the artificial intelligence (AI).

State-owned enterprises, which during the first period of President Jokowi\'s administration spearheaded investment through infrastructure construction, were encouraged to use more domestic products in collaboration with private domestic companies, especially in the regions.

Village funds have great potential to help grow the village economies and equalize welfare when they are on target, such as when they are used for building village infrastructure.

KOMPAS/ALIF ICHWAN

Workers tidy up a number of bags at Bengkel Mode in the PIK complex, Pulo Gadung, Jakarta, in October (17/10/2019).

In the midst of an economic slowdown that will still haunt us until 2020, we are grateful to have succeeded in solving most of the domestic political problems. The presence of two ministers who are representatives of the Gerindra Party in the government is expected to make businesses players more confident about domestic political stability. This becomes the capital to consolidate and seize the available opportunities.