Indonesia regains upper-middle income rank

Illustrative image (Photo: https://indonesiaexpat.id/)

Speaking at a cabinet meeting on July 3, Indonesian President Joko Widodo said that the World Bank Group has placed the country in the upper-middle income band of countries. Indonesia reclaimed the rank this year as gross national income per capita climbed to 4,580 USD. It’s an improvement from the previous reading of 4,140 USD, which had kept it in the lower-middle income status for the second straight year in 2022 due to the COVID-19 pandemic's impacts.

The World Bank’s latest rankings will bolster Indonesia’s ambition to become a high-income country by 2045, the centerpiece of outgoing President Joko Widodo’s economic platform.

Indonesia continued its strong post-pandemic recovery and its Gross Domestic Product (GDP) grew by 5.3% in 2022, the fastest rate in nine years.

However, Indonesian President Widodo still warned of the risks that Indonesia faces during the second half of 2023 such as unstable global environment and geopolitical tensions that may impact the country's economy and trade activities.

President Widodo also warned that global interest rates and inflation are still at relatively high levels. In addition, fragmentation in global trade appears, hindering trade cooperation.

The World Bank classifies four economic groups based on income from July 2022 to June 2023 as low-income (1,135 USD), low-middle-income (1,136 to 4,465 USD), and high-middle income (4,446 to 13,845 USD), and high income (over 13,845 USD)./.

VNA