IMF Sees Indonesia 2007 GDP Growth Above 6%

July 10, 2007
Growth could reach 6.5%-7% over next few years.

Given strong exports and rising levels of direct investment, The International Monetary Fund expects Indonesia's GDP growth this year to beat its initial projection of 6%.

"Our (initial) projection was 6%. Based on recent trends, we do see some upside potential, in particular as a result of the strong export growth and if investment picks up faster than our baseline projection in the second half," Stephen Schwartz said. "I think the government's more ambitious target of 6.3% should be achievable," he said.

First quarter growth clocked in at 6% and Indonesia is expecting its fastest full-year growth this year in more than a decade. Schwartz said he expected Southeast Asia's largest economy to grow at 6.5% to 7% over the next few years, supported by rising exports and investments and lower inflation levels.

"Lower inflation is an encouraging development because it will stimulate corporations to borrow more and boost consumer sector growth," he said.

Copyright Agence France-Presse, 2007

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