World Bank Projects Indonesia's Economy to Grow Around 5% Until 2027

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Adi Ahdiat 17/12/2025 14:26 WIB

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The World Bank estimates Indonesia's economic growth will remain around 5% in the coming years, lower than the government's target.

Indonesia's Economic Growth Projection (2025-2027)

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Indonesia's Economic Growth Projection (2025-2027)

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President Prabowo Subianto targets Indonesia's economic growth to continue strengthening during his leadership.

In the National Medium-Term Development Plan (RPJMN), Indonesia's economy is targeted to reach 8% with the following stages:

2025: economy grows 5.3%
2026: economy grows 6.3%
2027: economy grows 7.5%
2028: economy grows 7.7%
2029: economy grows 8%

However, the World Bank projects that Indonesia's economic growth will remain around 5% for the next few years.

In Indonesia Economic Prospects report, December 2025 edition, the World Bank predicts Indonesia's economy will grow 5% in 2025 and 2026, then slightly strengthen to 5.2% in 2027.

The World Bank believes Indonesia faces various challenges, one of which is the slowdown in private consumption.

"Private consumption—which was previously a key driver of growth—has declined, making the resilience of Indonesia's economic growth increasingly dependent on strengthening household purchasing power," the World Bank stated in its report.

They also view Indonesia as facing challenges related to job quality and household welfare.

"Although labor absorption increased by 1.3 percent from August 2024 to August 2025, this increase is still dominated by low-wage sectors, such as low value-added services and agriculture," said the World Bank.

"Although poverty rates continue to decline, the number of households feeling poor has actually increased. Economic insecurity is more pronounced among the middle class, alongside high income volatility and real wage dynamics," it continued.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."

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World Bank Projects Indonesia's Economy to Grow Around 5% Until 2027

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