From Government of Indonesia

Economy Grew 6% in Q1

Strong exports and reviving consumption helped push the economy in the first quarter, momentum that could see it grow even faster over the course of the year, The Jakarta Post reported.

First-quarter growth in terms of gross domestic product (GDP) was at 6% year-on-year, the Central Bureau of Statistics (BPS) said Tuesday (15/5/07).

On a quarterly basis, the economy grew by 2% to Rp915.9 trillion ($101.7 billion), from last year's final quarter.

Exports became the economy's main thruster, growing by 8.9% and making up more than half of the on-year first-quarter growth at 4.1%, as Indonesia gained from the strong demand and prices in the global market for its main commodities of metals, coal, crude palm oil and rubber.

Private consumption, which has been recovering lately due to the easing of inflation and interest rates, provided further impetus, growing by 4.5% and contributing to 2.6% of first-quarter growth.

Fixed investment and government spending also saw growth, at 7.5% and 4.3% respectively, but were still on their usual trend of beginning the year modestly.

Meanwhile, from the supply side, the bureau noted an on-year 9.3% growth in construction and an 8.5% expansion in the trade and tourism industry.

The trade and tourism sector made up 1.4% of the total first-quarter growth, just after the manufacturing and processing industry, which grew by 5.4% and contributed to 1.5% of the growth.

Private consumption still makes up more than 60% of the GDP, while exports and imports account for less than 10%.

"The (6%) growth in the first quarter confirmed that Indonesia has fully recovered from the 1997 financial crisis," Coordinating Minister for the Economy Boediono said.
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