The Central Bank of Indonesia (CBIG) recently released its assessment of the impact of floods and landslides in Aceh, North Sumatra, and West Sumatra provinces on Indonesia’s economic growth for the year.
CBIG Deputy Governor Aida S. Budiman stated that, according to preliminary calculations, the disasters in these three regions could reduce Indonesia’s overall economic growth by approximately 0.017%.
Aida explained that calculating the impact of the disasters is complex, requiring consideration not only of the economic impact but also other social factors such as asset losses, decreased productivity, economic stagnation, and post-disaster reconstruction. “Our current assessment method observes the losses in economic activity over 32 days, and this is still a preliminary calculation.”
For the full year, CBIG confirmed that economic growth will be between 4.7% and 5.5%. “We expect the growth rate in the fourth quarter to be higher than the 5.03% in the third quarter. Therefore, the full-year growth rate will be in the range of 4.7% to 5.5%, while in 2026 it will tend towards 4.9% to 5.7%,” Aida said.