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Sri Mulyani Says Indonesia Can Reach 6 Percent Economic Growth
TEMPO.CO, Jakarta – Finance Minister Sri Mulyani says that Indonesia 6 percent economic growth is possible if helped by high investment growth.
According to Sri Mulyani, investment is one of the main factors that influence economic growth. “If the investment can grow 8 percent, 6 percent economic growth is possible,” she said at the parliamentary building on Thursday, March 23, 2017.
Investment growth, however, has been poor in the past few years. Sri said that banking sector has been put under considerable pressure following a dip in commodity prices. As a result, companies find it difficult to get bank loans.
Sri Mulyani pointed to the problem that is the increase in the volume of non-performing loans (NPL). Under such condition, banks are forced to their loan volume. “With low loan growth, investment will not be able to drive up high growth,” she said.
Investment growth is also underpinned by foreign direct investment in state-owned enterprises (SOEs) in the form of state capital injection (PMN). SOE assets can soar fourfold with Rp1 trillion investment.
Indonesia once reached 10 percent economic growth during the Susilo Bambang Yudhoyono administration. Sri said that it could be achieved thanks to 6-10 percent investment growth.
According to Sri Mulyani, Indonesia can emulate such high economic growth. Aside from investment, the economy can also be boosted by an increase in household consumption, among others.
Source: https://en.tempo.co/read/news/2017/03/24/056859130/Sri-Mulyani-Says-Indonesia-Can-Reach-6-Percent-Economic-Growth