Jakarta: Indonesia’s economic growth is expected to rebound to 4.4% in 2021 and strengthen further to 5% in 2022, according to the World Bank’s June 2021 Global Economic Prospects.
However, many jobs in low-value-added services may be slow to return.
“Covid-19 infection rates remain elevated in Indonesia, Malaysia, and the Philippines and have recently increased in Cambodia and Thailand,” the report stated.
Growth in the East Asia and Pacific region is projected to strengthen to 7.7% in 2021, primarily reflecting a strong rebound in China.
Growth in China is projected to pick up to 8.5% this year, supported by buoyant exports and the relief of pent-up demand amid effective control of the outbreak.
Output in the rest of the region is projected to grow 4.0% in 2021 in the face of continued pandemic-related headwinds and delayed recovery of tourism and travel.
Growth in China is projected to moderate to 5.4% in 2022, reflecting diminishing fiscal and monetary support and tighter property and macroprudential regulations.
Growth in the region excluding China is expected to accelerate to 5% in 2022 as the economic recovery takes hold.
“Among the three largest economies, China, Indonesia, and Thailand, only China has seen its output surpass pre-pandemic levels,” the report stated.
Thailand’s economy is expected to recover gradually over the next two years, with growth picking up to 2.2% in 2021 and 5.1% in 2022, helped by a recovery in tourism and travel.
Philippine growth is projected at 4.7% in 2021 and 5.9% in 2022, while Malaysia is expected to rebound to 6% in 2021.
Vietnam is projected to expand 6.6% on average this year and next.
Among smaller economies, the recovery is expected to be particularly weak in tourism-dependent island economies as tourism is expected to remain below pre-pandemic levels until at least 2023.