Q2 GDP +6.28% on Year on Exports

The economy expanded 6.28% on year in the second quarter, accelerating from 5.97% the previous quarter, the Central Bureau of Statistics (BPS) said Wednesday (15/8/07).

On quarter, the economy grew 2.41%, quickening from 1.97% in the January-March period.

The bureau said the main driver of growth was exports, which grew 3.82% on quarter and 9.79% on year. "Non-oil and non-gas exports rose, thanks to high global commodity prices and also improving economic performance of (export destination) countries," BPS deputy chairman Slamet Sutomo was quoted as saying by Dow Jones Newswires.

The bureau said private consumption, which has been supporting economic growth since 2000, grew 1.46% on quarter and 4.71% on year, as inflation has been relatively tame.

Government consumption grew 3.83% on year in the second quarter and 24.18% from the previous quarter.

Investment expanded 6.86% on year and 4.3% on quarter due to an improving investment climate in the country.

The economy is expected to power forward for the rest of the year by both private-sector economists and the government. The central bank is projecting 6.2% on-year growth for the July-September period.

"Third-quarter growth will improve, especially because household consumption is expected to rise during the fasting month," Sutomo added. The Muslim fasting month will begin in the middle of September.

Coordinating Minister for Economic Affairs Boediono said with strong growth in the second quarter, the government's 6.3% economic growth forecast for 2007 is within reach.

"I think it is possible to achieve (that target). Some people have been pessimistic about the second quarter, but (the economy) turned out to be quite strong," he was quoted as saying by Thomson Financial.
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