ASEAN’s largest economy slows to lowest growth since Q3/2021
Official data released recently indicates that Indonesia's economic growth decelerated in Q1 due to weakened domestic consumption.
A crane loading a container onto a truck at Tanjung Priok Port in Jakarta, Indonesia, February 12, 2025. Photo courtesy of Reuters/VNA.
According to Indonesia’s Central Statistics Agency (BPS), the Southeast Asian nation's economy grew by 4.87% in the first three months of the year.
This marks the slowest growth pace since Q3/2021 and is lower than the 5.11% recorded in the same period last year.
Compared to Q4/2024, Indonesia’s GDP contracted by 0.98%.
BPS chief Amalia Adininggar Widyasanti stated that Indonesia’s economic growth was largely driven by household consumption, the biggest contributor to GDP, and exports.
Household spending was supported by holiday-related expenditures during the month of Ramadan and the Eid al-Fitr festival in March this year, but it grew by just 4.89% in Q1, slightly below the 4.91% growth in Q1/2024.
Gareth Leather, senior economist in the Asia team at Capital Economics, noted that Indonesia is considered one of the least trade-dependent economies in the region, and that U.S. tariff policies are expected to have only a limited direct impact on its economy.
The Indonesian Government has set a growth target of 5.2%. Meanwhile, President Prabowo Subianto has set an ambitious target of achieving 8% economic growth by 2029.
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