DBS, a leading financial institution, has expressed optimism about Indonesia’s economic outlook, contrasting it with the relatively slower growth of Thailand. According to DBS, once the current situation stabilizes, there are compelling reasons to be positive about Indonesia’s prospects.
Indonesia, the largest economy in Southeast Asia, has been experiencing a significant transformation in recent years. The country has implemented various reforms aimed at improving its business environment, investing in infrastructure, and boosting economic growth. These efforts have started to bear fruit, with Indonesia’s economy showing resilience in the face of global headwinds.
DBS highlights several factors that contribute to Indonesia’s positive outlook. Firstly, the country has made significant progress in improving its macroeconomic stability, including reducing its fiscal deficit and maintaining a stable inflation rate. Secondly, Indonesia has implemented policies to enhance its trade competitiveness, such as reducing logistics costs and improving the business environment.
In contrast, Thailand’s economy has been experiencing a slower growth rate compared to Indonesia. DBS attributes this to several factors, including a decline in tourism, a key driver of Thailand’s economy, and a slowdown in exports. Additionally, Thailand’s economy has been impacted by domestic political uncertainty and a strong baht, which has affected the country’s trade competitiveness.
Despite these challenges, DBS believes that Indonesia’s economic growth will continue to outpace Thailand’s in the near term. The bank expects Indonesia’s economy to grow by around 5% in 2023, driven by strong domestic demand, infrastructure investment, and a recovery in commodity prices.
DBS also notes that Indonesia has made significant progress in developing its digital economy, with the country experiencing rapid growth in e-commerce, fintech, and other digital sectors. This has created new opportunities for businesses and investors, and is expected to contribute to Indonesia’s long-term economic growth.
Overall, DBS’s positive outlook on Indonesia’s economy is based on the country’s strong fundamentals, including its large and growing market, improving business environment, and significant investment in infrastructure and human capital. While Thailand’s economy faces challenges, Indonesia is well-positioned to continue its growth trajectory, making it an attractive destination for investors and businesses.