The 5.18 percent (y/y) GDP growth in Q2-2016 is a very positive result for Southeast Asia's largest economy, supported by growth in nearly all sub-sectors (only mining extraction contracted) with the financial services and insurance sector posting the highest growth at 13.51 percent (y/y).

Household consumption, which accounts for some 55 percent of total economic growth in Indonesia, improved in the second quarter of the year, accelerating by 5.04 percent (y/y) from 4.94 percent (y/y) in the preceding quarter. Government spending accelerated more markedly from 2.94 percent (y/y) in Q1-2016 to 6.28 percent (y/y) in Q2-2016. However, investment growth fell slightly to 5.06 percent (y/y) from 5.57 percent (y/y) in the first quarter. Meanwhile, Indonesia's exports and imports continued to contract in the second quarter but at a slower pace compared to the preceding quarter.

The GDP growth data in the first half of 2016 give rise to optimism that after a prolonged period of economic slowdown and stabilization, the Indonesian economy is now starting to accelerate again. Indonesia Investments will publish a more detailed column on Indonesia's Q2-2016 economic growth performance later.

Indonesia's Quarterly GDP Growth 2009-2016 (annual % change):

Year    Quarter I
   Quarter II    Quarter III    Quarter IV    Full-Year
2016        4.91        5.18
2015        4.73        4.66         4.74         5.04         4.8
2014        5.14        5.03         4.92         5.01         5.0
2013        6.03        5.81         5.62         5.72         5.6
2012        6.29        6.36         6.17         6.11         6.0
2011        6.45        6.52         6.49         6.50         6.4
2010        5.99        6.29         5.81         6.81         6.2
2009        4.60         4.37         4.31         4.58         4.6

Source: Statistics Indonesia (BPS)

Poll Indonesia Investments:

Where do you see Indonesia's economic growth in full-year 2016?

Voting possible:  -

Results

  • Between 5.0% - 5.2% (55%)
  • Between 5.2% - 5.4% (19%)
  • Below 5.0% (15.5%)
  • More than 5.4% (10.5%)

Total amount of votes: 611

-

Discuss