Expect expanding manufacturing sector to bolster recovery in Q2: BKF

Trading

Indonesia’s expanding manufacturing and export sectors are expected to bolster economic growth in the second quarter of 2022, Head of the Fiscal Policy Agency (BKF) of the Finance Ministry, Febrio Kacaribu has said.

Indonesia’s Purchasing Managers’ Index (PMI) for the manufacturing sector increased to 51.9 in April 2022 compared to 51.3 the previous month.

“The increase shows that the policy for handling the COVID-19 pandemic as well as the increasing coverage of vaccination have been able to encourage the public to carry out activities (normally), especially in preparing for the Ramadan and Eid al-Fitr (celebration),” the BKF head noted in a statement issued here on Saturday.

Meanwhile, amid the international geopolitical conflict, the export demand for Indonesian manufactured products increased in April this year, he added.

The demand swelled to 35.2 percent compared to the same period in the previous year.

In accordance with the growth, business players added their production capacity by opening new job opportunities and increasing product stocks.

The total number of jobs created was the highest in the last 11 years.

The trend is expected to continue, thus the multiplier effect of the recovery of the manufacturing sector could sustainably and inclusively improve the national economic condition.

However, Kacaribu said he is concerned that the current global pressure due to rising commodity prices would pose a huge risk to the sustainability of the expansion of the global manufacturing sector, including in Indonesia.

“To sustain the strengthening of consumption and production amid the pressure, the government has made various interventions, such as providing social protection for poor and vulnerable peoples, as well as bolstering the coordination between institutions to maintain a balance public supply and demand,” he added.

In addition, the government is also optimizing the utilization of the state budget to maintain the momentum of the national economic recovery, both for manufacturers and consumers, by supporting the sustainability of various COVID-19 National Economic Recovery (PEN) programs.

Source: Antara News