OECD Cuts 2023 Global Economic Growth Projection To 2.2%

JAKARTA. The global energy and commodity crisis brought on by Russia's invasion of Ukraine is predicted to endure till 2023. This will affect the state of the global economy as a whole.

Therefore, the Organization for Economic Co-operation and Development (OECD) cut its projection for world economic growth for 2023 from the previous 2.8% to only 2.2%.

Quoting Kumparan.com, the actual global income value for 2023 is predicted to be only 55%, or about US$ 2.8 trillion.

In addition, in the report released by the OECD with the title Paying the Price of War, economic growth in 2023 will also be lower than in 2022, which is estimated to reach 3%.

A similar trend is also predicted to occur in Indonesia. Indonesia's economic growth in 2023 is expected to slow down to 4.8%, lower than this year's predicted growth of 5%.

Indonesia's Growth

However, the projected growth is higher than the original OECD forecast. In a report released in June 2022, the OECD estimates that Indonesia's economic growth in 2023 and this year will only be 4.7%.

Meanwhile, for Indonesia's inflation rate, the OECD estimates that the price increase in 2023 will not be as high as this year. In its presentation, the OECD said that Indonesia's inflation rate in 2023 will be at a lower level than this year's projection to 3.94%.

Declining Inflation

Furthermore, according to the OECD, Indonesia's inflation forecast in 2022 will be at 4.14%.

Citing Kontan.co.id, the OECD projection is higher than Bank Indonesia's inflation rate target of 4% throughout 2022. In 2023, BI estimates that the inflation rate will be in the range between 2%-4%.