Indonesia’s Journey to

Economic Recovery

M. Chatib Basri

University of Indonesia
 2

Impact on various income group based on profession: the case of Indonesia

120,0

110,0

employee
100,0 99,7

90,0
Enterpreneur 85,6
80,0

70,0 Informal 70,9

60,0
Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20

Source: OCE BMRI’s estimation

Sumber data: mutasi masuk per CIF (nasabah)
 Gross Domestic Product growth (y.o.y GDP Growth by expenditure
15,00
6,00
5,06 5,05 5,01 4,96 10,00 9,76
8,23
4,00
5,25
5,00 5,03
5,02
5,06 5,18
4,55
5,05 5,01
5,01
4,21 4,97
4,96
4,08
2,97 3,77
2,83
2,97
0,99 0,50 1,70 1,76
2,00 0,00 0,12 -0,38 0,36
-1,46 -1,84 -2,19
-3,62 -3,61

04 9

05 9

06 9

07 9

08 9

09 9

10 9

11 9

12 9

01 9

02 0

03 0

04 0

05 0

06 0

07 0

08 0

09 0

10 0

11 0

12 0

0
-4,05
-3,49

01

01

01

01

01

01

01

01

01

01

02

02

02

02

02

02

02

02

02

02

02

02
-5,00

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2
-6,47 -5,52
-5,32
-6,48 -6,15

03
0,00 -6,73 -7,90 -6,90 -7,21
-8,34 -8,61
-10,00
9

0
-11,66
01

01

01

01

01

01

01

01

01

01

02

02

02

02

02

02

02

02

02

02

02

02
-12,02
/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2
-13,52
03

04

05

06

07

08

09

10

11

12

01

02

03

04

05

06

07

08

09

10

11

12
-2,00 -2,19 -15,00
-18,29
-3,49 -20,00
-4,00
-23,00
-25,00
-5,32
-6,00 Gross Domestic Product: SNA 2008: 2010p Household Consumption
Government Gross Fixed Capital Formation
Export of Goods and Services Import of Goods and Services

Household Consumptions Investment

10,00 15,00
7,15 7,35 7,86
5,00 5,64
5,54
5,32 6,30
6,25
5,20 5,79 6,17 10,00
5,12
4,48
4,38 5,07
4,89
4,75 5,06
4,54
4,59
3,98
5,08
4,95
4,37
3,73
5,01
4,32 8,40 7,18 7,79
2,44 2,02
2,36 2,05
1,82 5,00
0,00 -0,73 -0,69
0,64
0,71
-1,69 -1,39 0,00
9

-3,30
01

01

01

01

01

01

01

01

01

01

02

02

02

02

02

02

02

02

02

02

02

02

-4,29 -4,09 -2,86

03/2019
04/2019
05/2019
06/2019
07/2019
08/2019
09/2019
10/2019
11/2019
12/2019
01/2020
02/2020
03/2020
04/2020
05/2020
06/2020
07/2020
08/2020
09/2020
10/2020
11/2020
12/2020
-5,00 -3,92
/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

/2

-5,14
-5,00
03

04

05

06

07

08

09

10

11

12

01

02

03

04

05

06

07

08

09

10

11

12

-7,28 -7,57
-10,00 -9,45 -10,00
-10,94
-11,56
-15,00
-12,86
-15,00 -15,33
-16,53
-20,00 -21,01
-20,00
-25,00
Household: F&B, Other than Restaurant Household: App, Footwear & Maintenance
-30,00
Household: Equipments Household: Health & Education
-35,00
Household: Transportation & Comm Household: Restaurant & Hotel
-40,00
Buildings & Structures Machine & Equipment Vehicles Other Equipments

Source: BPS, CEIC (2020)

 K-Shape recovery?
¡ Social distancing: biased in favour towards
middle-upper income group if the govt fail to
provide social protection

¡ Inequality:

¡ Redefinition of job

¡ Gender gap, home technology, financial

inclusion

¡ Access to health, education, digital tech

 5

Percentage of Savings to Total Income

based on income group
25,0

20,0

15,0

10,0

5,0

0,0

All Rp. 1 million - Rp. Rp. 2,1 million - Rp. 3,1 million - Rp. 4,1 million - > Rp. 5 million
2 million Rp. 3 million Rp. 4 million Rp. 5 million
Ags Sep Okt
 6

Changing of Consumer
Behaviour
C. BERDASARKAN KELOMPOK PENGHASILAN (1/7)

Indeks nilai belanja semua kelompok penghasilan cenderung kembali meningkat, Higher Income
masih di bawah level prapandemi

Indeks frekuensi belanja berdasarkan kelompok penghasilan Indeks nilai belanja berdasarkan kelompok penghasilan

111,8
107,6
106,2
104,9
102.4

92.1

PSBB I PSBB II PSBB III

Sumber: Big data Bank Mandiri

GAMBARAN UMUM MOBILITAS DAN BELANJA MASYARAKAT (2/5)

Tingkat mobilitas mempengaruhi tingkat belanja masyarakat. Semakin tinggi mobilitas, semakin tinggi
nilai belanja masyarakat, demikian sebaliknya.
Indeks nilai belanja vs Indeks Google Community Mobility Indeks nilai belanja vs Indeks Google Community Indeks nilai belanja vs Indeks Google Community Mobility
(RETAIL & RECREATION) Mobility (GROCERY & PHARMACY) (RESIDENTIALS)

120 120 120 y = -3,069x + 110,06

y = 1,2242x + 106,33 y = 1,5718x + 90,219
R² = 0,7282
R² = 0,7118 110 R² = 0,7226 110 110
100 100 100
90 90 90
80 80 80
70 70 70
60 60 60
50 50 50

Retail & Recreation 40 Grocery & Pharmacy 40 40 Residentials

-50 -40 -30 -20 -10 0 -30 -20 -10 0 10 20 0 5 10 15 20

Indeks nilai belanja vs Indeks Google Community Mobility Indeks nilai belanja vs Indeks Google Community Mobility
(PARKS) (TRANSIT STATIONS)

120 120
y = 1,1681x + 100,26
110 y = 0,8277x + 111,6 110
R² = 0,6985
R² = 0,7767
100 100
90 90
80 80
70 70
60 60
50 50

Parks 40 Transit Stations

40
-45 -35 -25 -15 -5 5 -80 -60 -40 -20 0

Sumber: Big data Bank Mandiri, Google Community Mobility Reports, diolah.

Mandiri Institute
 data.
class is sp
4 percent
of9total co
FIGURE E.5 Breakdown of consumption, 2016 for UC). W
(percent of total consumption) ing more
tors, the m
The middle class is the only class that spends more on ones star
non-food items than food, increasingly on entertainment,
durables and vehicles. to comfor
0 100 tioners an
P areas (Fi
househol
V while 20 p
2 own car
AMC most upp
vehicles a
MC 1
consump
MC 2

UC

Entertainment Goods/service Source: Susenas

Tax/insurance Education and World Bank
17 Althou
calculations.
Vehicles Health vehicle p
Durables (excl. Vehicles) common pr
House
(deprecia
Clothes Food for annua

World Bank 2019

 10

Spending on electronics and hobbies are improving

Infected cases
increased again
Spending Index on January
2020 =100

160

140

120
105,6
100 101,3
94,2
80 92,7

60

40

20

0
Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20

Source: OCE BMRI’s estimation, Data transaksi kredit & debit BMRI
ELECTRONICS GASOLINES HOBBIES SPORTS

https://www.mandiri-research.or.id
 Behavioral Economics

Key takeaways:

RESIDENTIAL AND NEW CASES

• Workplaces↑ → new cases ↑.
• mall/restoran ↑ → new cases
↑
• transit station ↑ → new cases ↑
• grocery↑ → new cases ↑

RESIDENTIAL
• New death case ↑ →
residential ↑ (less than 5 days)
 12

¡ External sector: weak

Why do we need fiscal ¡ Real challenge will be in 2021: will
expansion? private investment kick in in 2021?
ACCUMULATED RESPONSE TO GENERALIZED ONE SD INNOVATIONS ¡ Economics of scale: with health
0.02 protocol in place, difficult to achieve
0.018 Break Even Point (Hotel 46%;
0.016 Restaurant 68%; Retail FMCG 32%, non
0.014
FMCG 42%; Cement industry 54%)
0.012
¡ Vaccine ? Will take some time : 181.5
0.01 mil 500.000 shots per day.
0.008

0.006 ¡ Consumption vs investment;

0.004
consumption will induce investment
0.002
Fiscal stimulus as a jump start
0
Q1 Q2 Q3 Q4
¡ Fiscal: extend cash transfer (BLT) to
Investment to PC PC to Investment lower middle income

Impulse Response Function ¡ National Economic Recovery Program

(PEN): Health; credit guarantee,
interest rate subsidy, tax incentive
 13
Mengapa Indonesia harus pulih
lebih cepat:
Tantrum without tapering
¡ Recovery di US: Vaksin diperkirakan mencapai
200 juta May 2021. Target selesai 4 July 2021

¡ Raising yield US treasury

¡ Capital out flow

¡ Financial Market

¡ Policy Response
 14

Exit Strategy Fiscal Framework

¡ Fiscal

¡ Moneter
 15

Thank you