Indonesia’s economy built momentum through 2009, with government policies supporting growth, but maintaining this momentum will be a policy challenge
Growth returned to pre-crisis peaks in Q4 and other indicators were in sharp contrast to late 2008
The budget deficit was smaller than expected in 2009, with the stimulus supporting growth…
Foreign investors continued to seek Indonesian financial assets, driving government bond yields to record lows…and challenging the central bank.
The outlook has strengthened slightly since late 2009
Maintaining this momentum into the medium-term will require supporting entrepreneurs’ investments, both by investing in infrastructure and the quality of public services, and ensuring all Indonesians benefit from the economy’s growth.