Indonesian household consumption is projected to surge above 5%.

The COVID-19 pandemic caused a slowdown in Indonesian household consumption. The government, through the National Economic Recovery Program (PEN), has been striving to boost household consumption. Based on these government efforts, the World Bank predicts that Indonesian household consumption will return to growth above 5% this year and continue through 2024.

Indonesian household consumption grew slowly at 2.7% in 2020, down from 5.2% the previous year. This decline in household consumption performance is a concern, as this component is the engine of the Indonesian economy.

One of the government's efforts to encourage household consumption, outlined in the National Economic Recovery Program (PEN), is through social safety nets for those affected by COVID-19. Household consumption has gradually improved, with positive growth of 3.7% in 2021.

With economic recovery and increased vaccination rates, household consumption is projected to grow above 5%. The World Bank projects household consumption to reach 5.2% in 2022.

The World Bank further projects a slight slowdown to 5.1% in 2023, followed by a return to 5.2% in 2024.