Head of Department of Economic and Monetary Policy Bank Indonesia (BI) Solikin Juhro pointed out pandemic Covid-19 as the culprit Indonesia failed to maintain its position as an upper middle-income country. This means that RI has decreased to lower middle income countries.
According to him, the pandemic eroded projections (trajectory) Indonesia as a high-income country or a developed country. This can be seen from the Gross Domestic Product (GDP) per capita of the Republic of Indonesia, which fell in 2020 to US$3,900 per year, which is included in the standards of lower-middle income countries.
“Performance of growth which is at a relatively high level has pushed Indonesia’s per capita income to the upper middle category, but the pandemic has changed trajectory that, “he said on the G20 agenda titled Shfting Toward Higher Value-Added IndustriesMonday (14/2).
Nevertheless, he admitted that he was optimistic that Indonesia could still become a developed country as targeted in 2045. One way to do this is by leveraging the added value of the manufacturing industry, which is one of the backbones of the Indonesian economy.
“Indonesia now has a GDP per capita of around US$3,900 per year (2020). This is closer to the range of lower-middle income countries,” he explained.
Similar data was previously displayed by the Central Statistics Agency (BPS) which recorded a per capita income of the Republic of Indonesia last year of Rp62.2 million equivalent to US $ 4,349 GDP. The figure is up from 2020 GDP of US $ 3,934.5 or per capita income of Rp57.3 million.
Before the pandemic hit, Indonesia’s per capita income was at the level of US$ 4,129.8 or Rp. 59.3 million, lower than 2021 but above 2019.
The World Bank (World Bank) in 2020 lowered Indonesia from the category of upper middle income countries (upper middle income) in 2019 and then became a low-middle income country (lower middle income).
From the publication which is updated every July 1, the World Bank noted that Indonesia’s Gross National Income (GNI) fell from US$4,050 to US$3,870. The decline in Indonesia’s status was due to the impact of the COVID-19 pandemic which hit people’s income.
The calculations carried out by the World Bank consider economic growth, inflation, currency exchange rates, and population growth which are influenced by GNI per capita.
In the new classification, the World Bank categorizes lower middle-income countries with an income range of US $ 1,046-US $ 4,095 and upper middle-income groups of US $ 4,096-US $ 12,695.
(wel/one)
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