Indonesia's economy will likely grow between 6% and 6.5% this year, despite high inflation and monetary tightening, Asian Development Bank (ADB) president Haruhiko Kuroda said Wednesday, Dow Jones reported.
"In the long term growth could even accelerate to 7%," Kuroda said. He didn't elaborate.
Bank Indonesia's most recent forecast is for 6.2% growth in gross domestic product this year and 6.3% growth in 2009. Indonesia's GDP grew by 6.3% in 2007.
Kuroda also said the ADB has allocated $1 billion that can be loaned to Indonesia to support economic growth. “In the next three years we are still calculating but we will provide approximately $1.2 billion (in total loans)," he said. Kuroda said Indonesia's inflation rate has likely peaked and should decline. Kuroda reiterated that the ADB plans to issue local-currency bonds to fund its Indonesian projects, but said it is assessing market conditions and doesn't have a fixed date for the issuance. The ADB previously said it would issue an indicative Rp1 trillion in bonds in the third or fourth quarter of this year.