Indonesia’s growth in 2009 was four and a half percent, the third highest in the G-20 group of countries; and the pace is accelerating in 2010. Both push and pull factors have attracted large portfolio inflows, particularly into government bonds and Short-term Bank Indonesia certificates...

This Selected Issues paper for Indonesia uses a small structural macroeconomics model of the Indonesian economy to analyze the inflation outlook and monetary policy challenges. The Bank of Indonesia (BI) introduced its Inflation Targeting Framework in July 2005 with the goal to reduce inflation...

Indonesia recovered quickly after being hit hard by contagion from the global financial crisis. Banking fundamentals have improved, with most Indonesian banks reporting high capital, comfortable levels of liquidity, and solid profitability. Banks exhibit rising credit exposures to retail and...

The paper reviews the progress being made toward Indonesia's full emergence from the crisis. Banking sector restructuring has been at the heart of the reform program. Corporate debt restructuring is critical for resumption of normal credit flows and Indonesia's full and sustainable economic...

This 2007 Article IV Consultation highlights that Indonesia’s economic performance has been strong since the last Article IV Consultation. Supported by sound policies and a favorable external environment, output has grown strongly, inflation has stabilized, and international reserves have...

This paper reviews Indonesia’s 2004 Article IV Consultation and Post-Program Monitoring Discussions. The Article IV consultation provided a timely opportunity to assess achievements under recent IMF arrangements and to take stock of remaining challenges. The discussions focused on policies to...

The discussions focused on advancing the unfinished reform agenda, and strengthening the investment climate. The macroeconomic objectives for 2003 remain broadly unchanged from those presented at the seventh review. Discussions on the 2004 financing outlook focused on the implications of the...

Indonesia entered the current global crisis with strong initial conditions. This 2009 Article IV Consultation highlights that notwithstanding the initial impact of the global crisis, the economy has rebounded in 2009. Macroeconomic policy responses have kept appropriate pace with the evolving...

Indonesia’s external borrowing spreads increased by more than 1000 bps from mid-2007 to late 2008, before subsiding in recent months. The large increase in spreads prompted questions about whether the spreads adequately reflect the improvements in fundamentals made over the past few years....