{
  "title": "IMF Executive Board Concludes 2020 Article IV Consultation with Indonesia",
  "publication": "IMF News, March 3, 2021",
  "sourceUrl": "https://www.imf.org/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation",
  "canonical": "https://www.imf.org/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation",
  "overlayPath": "/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/index.md",
  "summary": "Real GDP increased by 3.2 percent in 2020:Q3 (q/q, s.a.) and is expected to have contracted by a modest 1.9 percent in 2020 as a whole. (Note: a footnote states the actual real GDP growth rate in 2020 was -2.1 percent.)",
  "publishDate": "2021-03-03",
  "sections": [
    {
      "heading": "Economic developments in 2020",
      "content": "- Real GDP increased by 3.2 percent in 2020:Q3 (q/q, s.a.) and is expected to have contracted by a modest 1.9 percent in 2020 as a whole. (Note: a footnote states the actual real GDP growth rate in 2020 was -2.1 percent.)\n- Headline inflation reached 1.7 percent (y/y) at end‑2020, below the Bank Indonesia’s target band (3±1 percent).\n- Current account deficit is expected to have narrowed to 0.5 percent of GDP in 2020, mostly due to a relatively sharper contraction of imports.\n- The Indonesian economy is gradually recovering driven by a bold, comprehensive, and coordinated policy response to the COVID‑19 pandemic."
    },
    {
      "heading": "Outlook and key projections",
      "content": "- Real GDP projections:\n  - 2021: 4.8 percent\n  - 2022: 6 percent\n- Inflation projection:\n  - Rise gradually to 3 percent (y/y) at end‑2021.\n- Current account projection:\n  - 2021: widen to 1.5 percent of GDP.\n- Credit growth:\n  - Expected to pick up in 2021 with stronger activity, albeit remaining below nominal GDP growth because of increased risks to asset quality and bank profitability.\n- Risks to the outlook:\n  - Upside: Early widespread vaccination.\n  - Downside: Delays in vaccination leading to a more protracted pandemic; larger-than-expected macro-financial fallout; slow improvement in credit conditions.\n- Policy measures cited as supporting the outlook:\n  - Increased public investment.\n  - COVID‑19 vaccine distribution plans.\n  - Improved global economic and financial conditions."
    },
    {
      "heading": "Executive Board assessment and guidance",
      "content": "- Commendations and observations:\n  - Authorities’ containment measures and supportive macroeconomic policies cushioned the pandemic’s economic impact.\n  - Indonesia’s strong fundamentals and prudent macroeconomic policy track record contributed to resilience.\n- Fiscal policy:\n  - Directors commended the authorities’ commitment to return to the statutory budget deficit ceiling by 2023.\n  - Emphasized unwinding exceptional measures in a balanced manner.\n  - Stressed need to underpin fiscal rules with a medium-term fiscal strategy that includes revenue measures.\n  - Higher government revenues would help create space to boost development spending and support sustainable and inclusive growth.\n  - Capacity building support will be crucial.\n- Monetary policy and central bank operations:\n  - Maintaining an accommodative monetary policy stance, contingent on the inflation outlook, is appropriate.\n  - Authorities pursue accommodation via lower policy interest rates and government bond purchases by Bank Indonesia in current exceptional circumstances.\n  - Directors welcomed Bank Indonesia’s plan to conduct bond purchases in 2021 only as a last resort under the market mechanism and suggested clarifying last-resort criteria to enhance the monetary policy framework and safeguard operational independence.\n  - Noted the role of exchange rate flexibility in absorbing shocks.\n- Financial sector:\n  - Banking system remains stable; continued monitoring of bank asset quality is warranted.\n  - Proactive loan loss provisioning is critical for banks’ ability to weather deterioration in asset quality.\n  - Additional targeted policy steps may be necessary if bank lending to the private sector does not rebound.\n  - Importance of continuing to upgrade crisis management and resolution frameworks.\n- Structural reforms:\n  - Directors welcomed the omnibus bill on job creation and plans to close infrastructure gaps.\n  - Encouraged sustaining reform momentum with focus on:\n    - Developing a medium-term government revenue strategy.\n    - Financial deepening and digitalization.\n    - Fostering a greener economy and tackling challenges related to climate change."
    },
    {
      "heading": "Selected economic indicators (highlights and exact figures)",
      "content": "- Real GDP (percent change): 2016: 5.0; 2017: 5.1; 2018: 5.2; 2019: -1.9; 2020 1/: 4.8 (Est.); 2021 Proj.: 4.8\n  - Note: Table shows series including domestic demand components and discrepancies due to data timing; footnote 1/ states based on data as of January 29, 2021 and does not include national accounts data for 2020:Q4 released on February 5, 2021.\n- Gross investment (in percent of GDP): 2016: 33.9; 2017: 33.7; 2018: 34.6; 2019: 33.8; 2020: 32.5; 2021: 32.7\n- Gross national saving (in percent of GDP): 2016: 32.0; 2017: 32.1; 2018: 31.6; 2019: 31.1; 2020: 31.2\n- Consumer prices (end period, 12-month percent change): 2016: 3.0; 2017: 3.6; 2018: 2.6; 2019: 1.7; 2020: (end‑2020) 1.7\n- General government revenue (percent of GDP): 2016: 14.3; 2017: 14.1; 2018: 14.9; 2019: 14.2; 2020: 12.1\n- General government expenditure (percent of GDP): 2016: 16.8; 2017: 16.6; 2018: 16.4; 2019: 17.8; 2020: 18.0\n- General government balance (percent of GDP): 2016: -1.8; 2017: -2.2; 2018: -5.7; 2019: -5.9; 2020: -3.7\n- Primary balance (percent of GDP): 2016: -1.0; 2017: -0.9; 2018: 0.0; 2019: -0.5; 2020: -3.7; 2021: -4.0\n- General government debt (percent of GDP): 2016: 28.0; 2017: 29.4; 2018: 30.4; 2019: 30.6; 2020: 35.7; 2021: 40.1\n- Rupiah M2 (12-month percent change; end of period): 2016: 10.0; 2017: 8.3; 2018: 6.3; 2019: 6.5; 2020: 11.5; 2021: 7.0\n- Claims on private sector (12-month percent change; end of period): 2016: 7.7; 2017: 7.2; 2018: 10.3; 2019: 5.8; 2020: 5.6\n- Current account balance (in billions of U.S. dollars): 2016: -17.0; 2017: -16.2; 2018: -30.6; 2019: -30.4; 2020: -5.5; 2021: -17.4\n- Current account (in percent of GDP): 2016: -1.6; 2017: -2.9; 2018: -2.7; 2019: -1.5; 2020: -0.5 (expected)\n- Trade balance (in billions of U.S. dollars): 2016: 15.3; 2017: 18.8; 2018: -0.2; 2019: 23.4; 2020: 20.3\n- Gross reserves (in billions of U.S. dollars, end period): 2016: 116.4; 2017: 130.2; 2018: 120.7; 2019: 129.2; 2020: 135.9; 2021: 152.3\n- Gross reserves (in months of prospective imports of goods and services): 2016: 7.6; 2017: 7.1; 2018: 9.9; 2019: 8.1\n- Total external debt (in billions of U.S. dollars): 2016: 320.0; 2017: 352.5; 2018: 375.4; 2019: 403.5; 2020: 416.6; 2021: 446.9\n- Total external debt (percent of GDP): 2016: 34.3; 2017: 34.7; 2018: 36.0; 2019: 36.1; 2020: 38.3; 2021: 38.5\n- Rupiah per U.S. dollar (period average): 2016: 13,306; 2017: 13,383; 2018: 14,231; 2019: 14,140; 2020: 14,541; 2021: 14,541\n- Rupiah per U.S. dollar (end of period): 2016: 13,473; 2017: 13,568; 2018: 14,390; 2019: 13,866; 2020: 14,050\n\nPress Release No. 21/54, March 2, 2021.\n\n---\n\n\n References\n\n- https://www.imf.org/-/media/images/imf/bios/imfboard.jpg\n- The Executive Board\n- Indonesia and the IMF\n- IMF Policy Advice -- A Factsheet\n- Press Releases\n- PRESS CENTER\n- http://www.IMF.org/external/np/sec/misc/qualifiers.htm\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation"
    }
  ],
  "bullets": [
    "[Markdown version](/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/index.md)",
    "[Structured JSON version](/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/index.json)",
    "[Bundle manifest](/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/bundle-manifest.json)",
    "Published: March 3, 2021",
    "Real GDP increased by 3.2 percent in 2020:Q3 (q/q, s.a.) and is expected to have contracted by a modest 1.9 percent in 2020 as a whole. (Note: a footnote states the actual real GDP growth rate in 2020 was -2.1 percent.)",
    "Headline inflation reached 1.7 percent (y/y) at end‑2020, below the Bank Indonesia’s target band (3±1 percent).",
    "Current account deficit is expected to have narrowed to 0.5 percent of GDP in 2020, mostly due to a relatively sharper contraction of imports.",
    "The Indonesian economy is gradually recovering driven by a bold, comprehensive, and coordinated policy response to the COVID‑19 pandemic.",
    "Real GDP projections:",
    "Inflation projection:",
    "Current account projection:",
    "Credit growth:",
    "Risks to the outlook:",
    "Policy measures cited as supporting the outlook:",
    "Commendations and observations:",
    "Fiscal policy:",
    "Monetary policy and central bank operations:",
    "Financial sector:",
    "Structural reforms:",
    "Real GDP (percent change): 2016: 5.0; 2017: 5.1; 2018: 5.2; 2019: -1.9; 2020 1/: 4.8 (Est.); 2021 Proj.: 4.8",
    "Gross investment (in percent of GDP): 2016: 33.9; 2017: 33.7; 2018: 34.6; 2019: 33.8; 2020: 32.5; 2021: 32.7",
    "Gross national saving (in percent of GDP): 2016: 32.0; 2017: 32.1; 2018: 31.6; 2019: 31.1; 2020: 31.2",
    "Consumer prices (end period, 12-month percent change): 2016: 3.0; 2017: 3.6; 2018: 2.6; 2019: 1.7; 2020: (end‑2020) 1.7",
    "General government revenue (percent of GDP): 2016: 14.3; 2017: 14.1; 2018: 14.9; 2019: 14.2; 2020: 12.1",
    "General government expenditure (percent of GDP): 2016: 16.8; 2017: 16.6; 2018: 16.4; 2019: 17.8; 2020: 18.0",
    "General government balance (percent of GDP): 2016: -1.8; 2017: -2.2; 2018: -5.7; 2019: -5.9; 2020: -3.7",
    "Primary balance (percent of GDP): 2016: -1.0; 2017: -0.9; 2018: 0.0; 2019: -0.5; 2020: -3.7; 2021: -4.0",
    "General government debt (percent of GDP): 2016: 28.0; 2017: 29.4; 2018: 30.4; 2019: 30.6; 2020: 35.7; 2021: 40.1",
    "Rupiah M2 (12-month percent change; end of period): 2016: 10.0; 2017: 8.3; 2018: 6.3; 2019: 6.5; 2020: 11.5; 2021: 7.0",
    "Claims on private sector (12-month percent change; end of period): 2016: 7.7; 2017: 7.2; 2018: 10.3; 2019: 5.8; 2020: 5.6",
    "Current account balance (in billions of U.S. dollars): 2016: -17.0; 2017: -16.2; 2018: -30.6; 2019: -30.4; 2020: -5.5; 2021: -17.4",
    "Current account (in percent of GDP): 2016: -1.6; 2017: -2.9; 2018: -2.7; 2019: -1.5; 2020: -0.5 (expected)",
    "Trade balance (in billions of U.S. dollars): 2016: 15.3; 2017: 18.8; 2018: -0.2; 2019: 23.4; 2020: 20.3",
    "Gross reserves (in billions of U.S. dollars, end period): 2016: 116.4; 2017: 130.2; 2018: 120.7; 2019: 129.2; 2020: 135.9; 2021: 152.3",
    "Gross reserves (in months of prospective imports of goods and services): 2016: 7.6; 2017: 7.1; 2018: 9.9; 2019: 8.1",
    "Total external debt (in billions of U.S. dollars): 2016: 320.0; 2017: 352.5; 2018: 375.4; 2019: 403.5; 2020: 416.6; 2021: 446.9",
    "Total external debt (percent of GDP): 2016: 34.3; 2017: 34.7; 2018: 36.0; 2019: 36.1; 2020: 38.3; 2021: 38.5",
    "Rupiah per U.S. dollar (period average): 2016: 13,306; 2017: 13,383; 2018: 14,231; 2019: 14,140; 2020: 14,541; 2021: 14,541",
    "Rupiah per U.S. dollar (end of period): 2016: 13,473; 2017: 13,568; 2018: 14,390; 2019: 13,866; 2020: 14,050",
    "[https://www.imf.org/-/media/images/imf/bios/imfboard.jpg](https://www.imf.org/-/media/images/imf/bios/imfboard.jpg)",
    "[The Executive Board](https://www.imf.org/external/np/sec/memdir/eds.aspx)",
    "[Indonesia and the IMF](http://www.imf.org/external/country/IDN/index.htm)",
    "[IMF Policy Advice -- A Factsheet](https://www.imf.org/en/about/factsheets/imf-surveillance)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[http://www.IMF.org/external/np/sec/misc/qualifiers.htm](http://www.imf.org/external/np/sec/misc/qualifiers.htm)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
  ],
  "alternates": {
    "markdown": "/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/index.md",
    "json": "/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/index.json",
    "bundleManifest": "/en/news/articles/2021/03/01/pr2154-indonesia-imf-executive-board-concludes-2020-article-iv-consultation/bundle-manifest.json"
  },
  "generatedAtUtc": "2026-09-26T00:12:34.100Z"
}