JAKARTA, Sept. 25 (Xinhua) -- Indonesia is estimated to maintain a healthy growth rate in 2019 and 2020 on the back of continuing strong domestic consumption, the Asian Development Bank (ADB) said in its 2019 Asian Development Outlook (ADO) released on Wednesday.
Revising its economic outlook for Indonesia, ADB estimated that the country would see moderate growth of 5.1 percent and 5.2 percent in 2019 and 2020 respectively. The nation saw a 5.17-percent growth in 2018.
The slightly slower pace of expansion this year reflects a downturn in exports and moderating domestic investment, ADB said.
"Robust consumption should see Indonesia's economic expansion continue at a healthy pace this year and next year," ADB Country Director for Indonesia Winfried Wicklein said.
Consumer spending should maintain robust growth this year and next year, underpinned by rising household incomes, job growth, and low inflation, he added.
Economic fundamentals remain solid, with the fiscal position well-managed, prices stable, and reserves in a comfortable position, he said.
Inflation is likely to remain stable at 3.2 percent this year and 3.3 percent next year, which should help sustain momentum in private spending.
Core inflation is expected to remain anchored and food prices unchanged, he estimated.
"Stronger investment is needed to boost growth, with a focus on competitiveness and human capital development being the key," he added.
Investment is expected to improve toward the end of the year, as progress continues with the construction of national strategic projects that are upgrading infrastructure networks, he said.
Recent cuts by the central bank of Bank Indonesia (BI) to the policy rate are also likely to give an impetus to loan growth, he added.
In 2020, private investment should continue to improve as new reform initiatives are expected to be launched toward improving the business climate and accelerating the modernization of the economy, he said.
