Jakarta With its economy contracting 2.07 percent in 2020 due to the COVID-19 pandemic, Indonesia is projected to return to its status as a lower middle-income country, the National Development Planning Ministry said.
“Due to the pandemic, (the economic growth) has been corrected,” National Development Planning Minister/National Development Planning Agency head, Suharso Monoarfa, said at an online press conference on the state of the Indonesian economy here on Tuesday.
The country’s Gross Domestic Product (GDP) per capita and Gross National Income (GNI) per capita declined in 2020, he informed.
GDP declined from US$4,174.9 per capita in 2019 to US$3,911.7 per capita in 2020, while GNI declined from US$4,047 to US$3,806 during the period, he said.
At the end of 2019, the World Bank upgraded Indonesia’s status as an upper-middle income country from its previous status of a lower-middle income country, with income above US$4,046, Monoarfa noted.
“If the growth in 2021 can reach 4.5-5.5 percent, and 5 percent in the next year, we will have an income of US$4 thousand; thus, we can return to the status of an upper middle-income country,” he added.
However, if the growth remains constant at five percent, the country’s per capita income would stay below US$12 thousand and make it difficult for Indonesia to exit the middle income trap before 2045, he said.
Indonesia recorded a less sharper economic contraction compared to countries such as the US, which saw economic growth dip to minus 3.5 percent, the Philippines (minus 9.5 percent), and Mexico (minus 8.3 percent).
Meanwhile, Vietnam recorded a positive growth of 2.9 percent, China 2.3 percent, and Taiwan 3 percent.
Source: Antara News