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Prabowo Confident Of 7 Percent Economic Growth, What Are The Forecasts Of Several Institutions?

President Prabowo Subianto expressed his confidence in the bright prospects for economic growth in 2025. In his speech before several world leaders in Russia on Friday, June 20, the head of state said that Indonesia's economy could grow by 7 percent this year. "My experts say that in the first semester, our economic growth is more than 5 percent. It could even approach 7 percent by the end of this year or even more," Prabowo said in his speech at the plenary session of the St. Petersburg International Economic Forum (SPIEF) in St. Petersburg, Russia, as quoted from the president's official website, Sunday, June 22, 2025. He emphasized that this achievement reflects the success of the economic policy direction taken by the government. With this foundation, Prabowo is confident that the big targets in the near future can be achieved. "This shows that we have chosen the right path and we are achieving our goals," he said. Prabowo's projection exceeds the economic growth target set by the government in 2025, which is 5.2 percent. Several institutions and economists have even revised their economic growth projections lower than before due to the impact of global economic turmoil. Several institutions predict that Indonesia's economic growth this year will not even exceed 5 percent. 

Here are predictions from several institutions and economists: 

1. IMF (4.7 Percent) 

In the April 2025 edition of the World Economic Outlook report, the International Monetary Fund or IMF predicts that Indonesia's economy will only grow by 4.7 percent in 2025 and stagnate until 2026. This figure was revised from the previous forecast of 5.1 percent. The IMF's correction of growth was carried out in line with the escalation of the trade war due to the announcement of reciprocal tariffs by the United States. The IMF stated that current political policies and uncertainty in world trade have burdened the economies of developing countries, including Indonesia. 

2. World Bank (4.8 percent) 

The World Bank projects Indonesia's economic growth to be 4.7 percent in 2025. Through the publication of the April 2025 edition of the Macro Poverty Outlook, the World Bank said that uncertainty in global and domestic policies has triggered portfolio outflows, thereby depressing the rupiah exchange rate. Economic growth is projected to reach an average of 4.8 percent until 2027. 

3. LPEM FEB UI (4.9-5.0 percent) 

The Institute for Economic and Community Research, Faculty of Economics and Business, University of Indonesia (LPEM FEB UI) predicts that the Indonesian economy will grow by 4.9-5 percent throughout 2025. In a series of macro analysis, LPEM FEB UI assessed that Indonesia is not in a good position to reap potential benefits from the upcoming trade war. "On the other hand, domestic economic conditions have not shown any significant recovery in productivity." 

4. Citibank Economist (4.7 Percent) 

Chief Economist Citibank (Citi Indonesia) Helmi Arman predicts that Indonesia's economic growth at the end of 2025 will only be around 4.7 percent. According to Helmi, there is an economic slowdown. "We see that this year is indeed a bit slow down because it was already visible in the first quarter," he said after the press conference on Citi Indonesia's performance in the first quarter of 2025 in Jakarta, Monday, May 26, 2025 

5. Permata Institute for Economic Research (4.5-5.0 percent) 

Permata Bank Chief Economist Josua Pardede explained that the implementation of the United States' reciprocal tariffs caused uncertainty and escalation of the trade war. This prompted companies to postpone investment and expansion plans. Previously, the Permata Bank research institute was still optimistic that the Indonesian economy in 2025 would be able to grow to 5.11 percent. "We are considering revising economic growth from 5.11 to below 5 percent, in the range of 4.5 to 5.0 percent," he said. 

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Tag: Economic Growth Prabowo Subianto SPIEF