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SELECTED MACROECONOMIC AND OTHER INDICATORS
With a population of about 222.8 million people and growing at a rate of 1.36%, Indonesia is the fourth largest country in terms of population. With a labor force participation of 107.2 million, Indonesia provides a large pool of labor for the production of goods and services. Furthermore, Indonesia is now allocating 17.2 percent of total public expenditures on education; this is on a par with the OECD levels. In the medium to long term, this will have a positive effect to increase the number of educated middle-class and skilled pool of labor.
SELECTED INDICATORS |
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Population (2005) |
222.8 mn (4th) |
Capital City |
Jakarta |
GDP |
US$ 287bn |
GDP per capita |
US$ 1,290 |
GDP Growth (2007) |
6.4% |
Inflation (Jan-Dec 2007) |
6.6% |
Currency |
Indonesian Rupiah |
Foreign Exchange Reserves |
US$ 56.9 bn |
HDI |
0.711 (med) |
Sources: Bank Indonesia, Coordinating Ministry for the Economy, Indonesian Central Bureau of Statistics, The World Bank, The Economist, IMF. |
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The improved security situation and various economic reforms undertaken by the government in the past few years have produced encouraging results. The Indonesian economy is now in a relatively good shape.
The economy has shown great resilience in the aftermath of the 1998 Asian Financial Crisis. From its immediate post-crisis growth of 0.8%, in 2000-2003 GDP growth was 3-4% per annum; in the period of 2004-2007 the economy grew between 4-6%. In 2007 the Indonesian GDP grew by 6.3%, one of the highest growth rates in the region. In 2008, our economy is projected to grow by between 6.3-6.4%.
Indonesian products continue to be competitive in the world economy. In the past two years our exports grew by 18.5% and in 2006, the total export surpassed the US$ 100 billion mark.
Meanwhile, Indonesia's public debt to GDP ratio continues to slide down from 100% in 1999 to 56.9% in 2004, 42.1% in 2006 and 35.6% in 2007. The government is targeting to reduce this ratio to fall below 35% in the near future. Foreign reserves have climbed continuously from $34.7 billion in 2005 to $42.59 billion in 2006 and to $54.9 billion in 2007 and to $57.1 billion as of February 2008.
The impact of the reforms in Indonesia has contributed towards a stronger Indonesia-US bilateral relationship. The United States is a key trading partner of Indonesia; it is Indonesia's second largest export destination after Japan. In 2007 total bilateral trade was US$18.54 billion; this figure is an increase of $2.01 billion compared to the same period in 2006. Many Fortune 500 companies have a presence in Indonesia, and US investment in Indonesia has reached $10.6 billion.
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