JAKARTA (BLOOMBERG) – Indonesia’s Finance Minister Sri Mulyani Indrawati defended the nation’s statistics, saying there was no manipulation of the economic growth figures after some analysts questioned the unusual stability of the data.
“The government never intervenes in the statistics,” Indrawati said in a phone interview from Dubai on Wednesday (Nov 6). Statistics Indonesia, known as BPS, is independent and “quite reputable,” she said.
Data on Tuesday showed the economy expanded 5.02 per cent in the third quarter from a year ago, little changed from 5.05 per cent in the second quarter and 5.07 per cent in the first three months of the year. Growth has been fairly steady around 5 per cent for several years, prompting some economists, including Gareth Leather of Capital Economics, to question the figures.
Indrawati said growth has held above 5 per cent in recent years because household consumption, which accounts for 56 per cent of the economy, has been growing more than 5 per cent. With imports sharply contracting in the third quarter, net exports turned positive, boosting overall growth, she said.
The minister said she’s encouraged BPS to invite global institutions to review its methodologies, and there are probably consumption activities taking place online that aren’t being captured in the data.
“We are very open, we are very transparent about data, and we have never had a track record of fabricating data, whether in terms of inflation, GDP or unemployment,” she said. “Indonesia, in this era of openness, it’s impossible for us to think about fabricating the data.”
The questions raised by some analysts about the nation’s statistics are unreasonable and would “erode the confidence of our economic growth and policies,” the minister said. “I take it very seriously.”
She said the economy will probably expand 5.05 per cent this year, down from a revised forecast of 5.08 per cent. Interest rates are also still attractive compared to low yields elsewhere, making Indonesia a favored destination for foreign investors, she said.
The minister said she was concerned by the slowdown in investment and government spending last quarter, as well as the contraction in imports, which may indicate a drop in capital goods purchases and therefore, a further slide in investment. Growth may rebound in the fourth quarter with the new cabinet under President Joko Widodo expected to accelerate government spending, she said.
“Based on seasonal pattern, consumption will be more positive in the fourth quarter,” she said. “And we expect there will be more positive responses in investment with the presence of a new government.”