Indonesian third quarter economic growth comes in a little below expectations

A worker cutting metal at a factory in Sidoarjo, East Java, on Sept 30.
A worker cutting metal at a factory in Sidoarjo, East Java, on Sept 30. PHOTO: REUTERS

JAKARTA (Bloomberg) - Indonesia's economy grew less than analysts estimated last quarter, underscoring the challenge for the government as it seeks to accelerate spending and bolster growth.

Gross domestic product rose 4.73 per cent in the three months through September from a year earlier, the statistics bureau said in Jakarta on Thursday (Nov 5). That compared with a previously reported 4.67 per cent expansion the previous quarter, and was less than the median estimate for 4.8 per cent in a Bloomberg survey of 23 economists.

President Joko Widodo is struggling to revive growth amid declining demand for the country's commodities, stagnating foreign investment and weak domestic consumption. A new economic team is rolling out measures aimed at improving the business climate.

"I think the economy will only pick up next year," said Arianto Patunru, an economics professor at the Australian National University in Canberra. "I hope next year will be better as global activity starts to rebound and domestic reforms, including infrastructure spending, take effect."

Mr Joko, better known as Jokowi, initially targeted growth of 5.7 per cent this year. Finance Minister Bambang Brodjonegoro said in September that full-year expansion of between 4.9 per cent and 5 per cent was still achievable. That rate would be the slowest since the global financial crisis.